1. 1 1 Slide © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. or duplicated, or posted to a publicly accessible website, in whole or in part. Slides by John Loucks St. Edward’s University

2. 2 2 Slide © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 10, Part B Statistical Inference About Means and Proportions With Two Populations n Inferences About the Difference Between Two Population Proportions Two Population Proportions n Inferences About the Difference Between Two Population Means: Matched Samples Two Population Means: Matched Samples

3. 3 3 Slide © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. or duplicated, or posted to a publicly accessible website, in whole or in part. With a matched-sample design each sampled item With a matched-sample design each sampled item provides a pair of data values. provides a pair of data values. This design often leads to a smaller sampling error This design often leads to a smaller sampling error than the independent-sample design because than the independent-sample design because variation between sampled items is eliminated as a variation between sampled items is eliminated as a source of sampling error. source of sampling error. Inferences About the Difference Between Two Population Means: Matched Samples

4. 4 4 Slide © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. or duplicated, or posted to a publicly accessible website, in whole or in part. n Example: Express Deliveries Inferences About the Difference Between Two Population Means: Matched Samples A Chicago-based firm has documents that must A Chicago-based firm has documents that must be quickly distributed to district offices throughout the U.S. The firm must decide between two delivery services, UPX (United Parcel Express) and INTEX (International Express), to transport its documents.

5. 5 5 Slide © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. or duplicated, or posted to a publicly accessible website, in whole or in part. n Example: Express Deliveries Inferences About the Difference Between Two Population Means: Matched Samples In testing the delivery times of the two services, In testing the delivery times of the two services, the firm sent two reports to a random sample of its district offices with one report carried by UPX and the other report carried by INTEX. Do the data on the next slide indicate a difference in mean delivery times for the two services? Use a.05 level of significance.

6. 6 6 Slide © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. or duplicated, or posted to a publicly accessible website, in whole or in part. 32 30 19 16 15 18 14 10 7 16 25 24 15 15 13 15 15 8 9 11 UPXINTEXDifference District Office Seattle Los Angeles Boston Cleveland New York Houston Atlanta St. Louis Milwaukee Denver Delivery Time (Hours) 7 6 4 1 2 3 2 -2 5 Inferences About the Difference Between Two Population Means: Matched Samples

7. 7 7 Slide © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. or duplicated, or posted to a publicly accessible website, in whole or in part. H 0 :  d = 0  H a :  d  Let  d = the mean of the difference values for the two delivery services for the population two delivery services for the population of district offices of district offices 1. Develop the hypotheses. Inferences About the Difference Between Two Population Means: Matched Samples p –Value and Critical Value Approaches p –Value and Critical Value Approaches

8. 8 8 Slide © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. or duplicated, or posted to a publicly accessible website, in whole or in part. 2. Specify the level of significance.  =.05 Inferences About the Difference Between Two Population Means: Matched Samples p –Value and Critical Value Approaches p –Value and Critical Value Approaches 3. Compute the value of the test statistic.

9. 9 9 Slide © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. or duplicated, or posted to a publicly accessible website, in whole or in part. 5. Determine whether to reject H 0. We are at least 95% confident that there is a difference in mean delivery times for the two services? We are at least 95% confident that there is a difference in mean delivery times for the two services? 4. Compute the p –value. For t = 2.94 and d.f. = 9, the p –value is between For t = 2.94 and d.f. = 9, the p –value is between.02 and.01. (This is a two-tailed test, so we double the upper-tail areas of.01 and.005.) Because p –value <  =.05, we reject H 0. Inferences About the Difference Between Two Population Means: Matched Samples p –Value Approach p –Value Approach

10. 10 Slide © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. or duplicated, or posted to a publicly accessible website, in whole or in part. 4. Determine the critical value and rejection rule. Inferences About the Difference Between Two Population Means: Matched Samples Critical Value Approach Critical Value Approach For  =.05 and d.f. = 9, t.025 = 2.262. Reject H 0 if t > 2.262 5. Determine whether to reject H 0. Because t = 2.94 > 2.262, we reject H 0. We are at least 95% confident that there is a difference in mean delivery times for the two services?

11. 11 Slide © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. or duplicated, or posted to a publicly accessible website, in whole or in part. Step 1 Click the Data tab on the Ribbon Step 2 In the Analysis group, click Data Analysis Step 3 Choose t -Test: Paired Two Sample for Means from the list of Analysis Tools from the list of Analysis Tools Excel’s “t-Test: Paired Two Sample for Means” Tool Step 4 When the t -Test: Paired Two Sample for Means dialog box appears: dialog box appears: (see details on next slide) (see details on next slide)

12. 12 Slide © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. or duplicated, or posted to a publicly accessible website, in whole or in part. n Excel Dialog Box Excel’s “t-Test: Paired Two Sample for Means” Tool

13. 13 Slide © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. or duplicated, or posted to a publicly accessible website, in whole or in part. n Excel Value Worksheet Excel’s “t-Test: Paired Two Sample for Means” Tool

14. 14 Slide © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. or duplicated, or posted to a publicly accessible website, in whole or in part. Inferences About the Difference Between Two Population Proportions n Interval Estimation of p 1 - p 2 n Hypothesis Tests About p 1 - p 2

15. 15 Slide © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. or duplicated, or posted to a publicly accessible website, in whole or in part. n Expected Value Sampling Distribution of where: n 1 = size of sample taken from population 1 n 2 = size of sample taken from population 2 n 2 = size of sample taken from population 2 n Standard Deviation (Standard Error)

16. 16 Slide © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. or duplicated, or posted to a publicly accessible website, in whole or in part. If the sample sizes are large, the sampling distribution If the sample sizes are large, the sampling distribution of can be approximated by a normal probability of can be approximated by a normal probability distribution. distribution. If the sample sizes are large, the sampling distribution If the sample sizes are large, the sampling distribution of can be approximated by a normal probability of can be approximated by a normal probability distribution. distribution. The sample sizes are sufficiently large if all of these The sample sizes are sufficiently large if all of these conditions are met: conditions are met: The sample sizes are sufficiently large if all of these The sample sizes are sufficiently large if all of these conditions are met: conditions are met: n1p1 > 5n1p1 > 5n1p1 > 5n1p1 > 5 n 1 (1 - p 1 ) > 5 n2p2 > 5n2p2 > 5n2p2 > 5n2p2 > 5 n 2 (1 - p 2 ) > 5 Sampling Distribution of

17. 17 Slide © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. or duplicated, or posted to a publicly accessible website, in whole or in part. Sampling Distribution of p 1 – p 2

18. 18 Slide © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. or duplicated, or posted to a publicly accessible website, in whole or in part. Interval Estimation of p 1 - p 2 n Interval Estimate

19. 19 Slide © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. or duplicated, or posted to a publicly accessible website, in whole or in part. Market Research Associates is conducting Market Research Associates is conducting research to evaluate the effectiveness of a client’s new advertising campaign. Before the new campaign began, a telephone survey of 150 households in the test market area showed 60 households “aware” of the client’s product. Interval Estimation of p 1 - p 2 n Example: Market Research Associates The new campaign has been initiated with TV The new campaign has been initiated with TV and newspaper advertisements running for three weeks.

20. 20 Slide © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. or duplicated, or posted to a publicly accessible website, in whole or in part. A survey conducted immediately after the new A survey conducted immediately after the new campaign showed 120 of 250 households “aware” of the client’s product. Interval Estimation of p 1 - p 2 n Example: Market Research Associates Does the data support the position that the Does the data support the position that the advertising campaign has provided an increased awareness of the client’s product?

21. 21 Slide © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. or duplicated, or posted to a publicly accessible website, in whole or in part. Point Estimator of the Difference Between Two Population Proportions = sample proportion of households “aware” of the = sample proportion of households “aware” of the product after the new campaign product after the new campaign = sample proportion of households “aware” of the = sample proportion of households “aware” of the product before the new campaign product before the new campaign p 1 = proportion of the population of households p 1 = proportion of the population of households “aware” of the product after the new campaign “aware” of the product after the new campaign p 2 = proportion of the population of households p 2 = proportion of the population of households “aware” of the product before the new campaign “aware” of the product before the new campaign

22. 22 Slide © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. or duplicated, or posted to a publicly accessible website, in whole or in part..08 + 1.96(.0510).08 +.10 Interval Estimation of p 1 - p 2 Hence, the 95% confidence interval for the difference Hence, the 95% confidence interval for the difference in before and after awareness of the product is -.02 to +.18. For  =.05, z.025 = 1.96:

23. 23 Slide © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. or duplicated, or posted to a publicly accessible website, in whole or in part. n Excel Formula Worksheet Note: Rows 16-251 are not shown. Interval Estimation of p 1 - p 2 ABCDE 1Sur2Sur1Survey 2 (from Popul.1)Survey 1 (from Popul.2) 2NoYesSample Size250150 3YesNoNo. of "Yes"=COUNTIF(A2:A251,"Yes")=COUNTIF(B2:B151,"Yes") 4Yes Samp. Propor.=D3/D2=E3/E2 5NoYes 6 NoConfid. Coeff.0.95 7No Lev. Of Signif.=1-D6 8NoYesz Value=NORM.S.INV(1-D7/2,TRUE) 9YesNo 10No Std. Error=SQRT(D4*(1-D4)/D2+E4*(1-E4)/E2) 11Yes Marg. of Error=D8*D10 12YesNo 13Yes Pt. Est. of Diff.=D4-E4 14NoYesLower Limit=D13-D11 15Yes Upper Limit=D13+D11

24. 24 Slide © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. or duplicated, or posted to a publicly accessible website, in whole or in part. n Excel Value Worksheet Using Excel to Develop an Interval Estimate of p 1 – p 2 Note: Rows 16-251 are not shown. ABCDE 1Sur2Sur1Survey 2 (from Popul.1)Survey 1 (from Popul.2) 2NoYesSample Size250150 3YesNoNo. of "Yes"12060 4Yes Samp. Propor.0.480.40 5NoYes 6 NoConfid. Coeff.0.95 7No Lev. Of Signif.0.05 8NoYesz Value1.960 9YesNo 10No Std. Error0.0510 11Yes Marg. of Error0.0999 12YesNo 13Yes Pt. Est. of Diff.0.080 14NoYesLower Limit-0.020 15Yes Upper Limit0.180

25. 25 Slide © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. or duplicated, or posted to a publicly accessible website, in whole or in part. Hypothesis Tests about p 1 - p 2 n Hypotheses H 0 : p 1 - p 2 < 0 H a : p 1 - p 2 > 0 Left-tailedRight-tailedTwo-tailed We focus on tests involving no difference between the two population proportions (i.e. p 1 = p 2 )

26. 26 Slide © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. or duplicated, or posted to a publicly accessible website, in whole or in part. Hypothesis Tests about p 1 - p 2 Pooled Estimate of Standard Error of Pooled Estimate of Standard Error ofwhere:

27. 27 Slide © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. or duplicated, or posted to a publicly accessible website, in whole or in part. Hypothesis Tests about p 1 - p 2 Test Statistic Test Statistic

28. 28 Slide © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. or duplicated, or posted to a publicly accessible website, in whole or in part. Can we conclude, using a.05 level of significance, Can we conclude, using a.05 level of significance, that the proportion of households aware of the client’s product increased after the new advertising campaign? Hypothesis Tests about p 1 - p 2 n Example: Market Research Associates

29. 29 Slide © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. or duplicated, or posted to a publicly accessible website, in whole or in part. Hypothesis Tests about p 1 - p 2 1. Develop the hypotheses. p -Value and Critical Value Approaches p -Value and Critical Value Approaches H 0 : p 1 - p 2 < 0 H a : p 1 - p 2 > 0 p 1 = proportion of the population of households p 1 = proportion of the population of households “aware” of the product after the new campaign “aware” of the product after the new campaign p 2 = proportion of the population of households p 2 = proportion of the population of households “aware” of the product before the new campaign “aware” of the product before the new campaign

30. 30 Slide © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. or duplicated, or posted to a publicly accessible website, in whole or in part. Hypothesis Tests about p 1 - p 2 2. Specify the level of significance.  =.05 3. Compute the value of the test statistic. p -Value and Critical Value Approaches p -Value and Critical Value Approaches

31. 31 Slide © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. or duplicated, or posted to a publicly accessible website, in whole or in part. Hypothesis Tests about p 1 - p 2 5. Determine whether to reject H 0. We cannot conclude that the proportion of households aware of the client’s product increased after the new campaign. 4. Compute the p –value. For z = 1.56, the p –value =.0594 Because p –value >  =.05, we cannot reject H 0. p –Value Approach p –Value Approach

32. 32 Slide © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. or duplicated, or posted to a publicly accessible website, in whole or in part. Hypothesis Tests about p 1 - p 2 Critical Value Approach Critical Value Approach 5. Determine whether to reject H 0. Because 1.56 < 1.645, we cannot reject H 0. For  =.05, z.05 = 1.645 4. Determine the critical value and rejection rule. Reject H 0 if z > 1.645 We cannot conclude that the proportion of households aware of the client’s product increased after the new campaign.

33. 33 Slide © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. or duplicated, or posted to a publicly accessible website, in whole or in part. n Excel Formula Worksheet Hypothesis Tests about p 1 - p 2 Note: Rows 17-251 Rows 17-251 are not shown.

34. 34 Slide © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. or duplicated, or posted to a publicly accessible website, in whole or in part. Hypothesis Tests about p 1 - p 2 n Excel Value Worksheet ABCDE 1Sur2Sur1Survey 2 (from Popul.1)Survey 1 (from Popul.2) 2NoYesSample Size250150 3YesNo Resp. of Interest Yes 4 Count for Resp.12060 5NoYesSample Propor.0.480.40 6YesNo 7 Hypoth. Value0 8NoYesPoint Est. of Diff.0.08 9YesNo 10No Pooled Est. ofp0.450 11Yes Standard Error 12YesNoTest Statistic1.557 13Yes 14NoYesp-Value (lower tail)0.940 15Yes p-Value (upper tail)0.060 16YesNop-Value (two tail)0.120 0.0514 Note: Rows 17-251 Rows 17-251 are not shown.

35. 35 Slide © 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. or duplicated, or posted to a publicly accessible website, in whole or in part. End of Chapter 10, Part B