Hypothesis testing is a form of statistical inference that uses data from a sample
to draw conclusions about a population parameter or a population probability
distribution. First, a tentative assumption is made about the parameter or
distribution. This assumption is called the null hypothesis and is denoted by H0.
An alternative hypothesis (denoted Ha), which is the opposite of what is stated in
the null hypothesis, is then defined. The hypothesis-testing procedure involves
using sample data to determine whether or not H0 can be rejected. If H0 is
rejected, the statistical conclusion is that the alternative hypothesis Ha is true.
For example, assume that a radio station selects the music it plays based on the
assumption that the average age of its listening audience is 30 years. To
determine whether this assumption is valid, a hypothesis test could be
conducted with the null hypothesis given as H0: μ = 30 and the alternative
hypothesis given as Ha: μ ≠ 30. Based on a sample of individuals from the
listening audience, the sample mean age, x̄, can be computed and used to
determine whether there is sufficient statistical evidence to reject H0.
Conceptually, a value of the sample mean that is “close” to 30 is consistent with
the null hypothesis, while a value of the sample mean that is “not close” to 30
provides support for the alternative hypothesis. What is considered “close” and
“not close” is determined by using the sampling distribution of x̄.
Ideally, the hypothesis-testing procedure leads to the acceptance of H0 when H0
is true and the rejection of H0 when H0 is false. Unfortunately, since hypothesis
tests are based on sample information, the possibility of errors must be
considered. A type I error corresponds to rejecting H0 when H0 is actually true,
and a type II error corresponds to accepting H0 when H0 is false. The probability
of making a type I error is denoted by α, and the probability of making a type II
error is denoted by β.
In using the hypothesis-testing procedure to determine if the null hypothesis
should be rejected, the person conducting the hypothesis test specifies the
maximum allowable probability of making a type I error, called the level of
significance for the test. Common choices for the level of significance are α =
0.05 and α = 0.01. Although most applications of hypothesis testing control the
probability of making a type I error, they do not always control the probability of
making a type II error. A graph known as an operating-characteristic curve can
be constructed to show how changes in the sample size affect the probability of
making a type II error.
A concept known as the p-value provides a convenient basis for drawing
conclusions in hypothesis-testing applications. The p-value is a measure of how
likely the sample results are, assuming the null hypothesis is true; the smaller
the p-value, the less likely the sample results. If the p-value is less than α, the
null hypothesis can be rejected; otherwise, the null hypothesis cannot be
rejected. The p-value is often called the observed level of significance for the
test.
A hypothesis test can be performed on parameters of one or more populations as
well as in a variety of other situations. In each instance, the process begins with
the formulation of null and alternative hypotheses about the population. In
addition to the population mean, hypothesis-testing procedures are available for
population parameters such as proportions, variances, standard deviations, and
medians.
Hypothesis tests are also conducted in regression and correlation analysis to
determine if the regression relationship and the correlation coefficient are
statistically significant (see below Regression and correlation analysis). A
goodness-of-fit test refers to a hypothesis test in which the null hypothesis is that
the population has a specific probability distribution, such as a normal probability
distribution. Nonparametric statistical methods also involve a variety of
hypothesis-testing procedures.
