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The basic logic of hypothesis testing is to prove or disprove the research question. By only
allowing an error of 5% or 1% and making correct decisions based on statistical principles, the
researcher can conclude that the result must be real if chance alone could produce the same
result only 5% of the time or less. These five steps consists of all the decisions a researcher
needs to make in order to answer any research question using an inferntial statistical test.
the mean and the variable salary is continuous. The hypothesized value of the parameter, the
mean, is $30,000. Since the parameter is a population mean of a continuous variable variable,
this suggests a one sample test of a mean.
5. STATE CONCLUSIONS.
The fifth and final step is to describe the results and state correct statistical conclusions in an
understandable way. The conclusions consists of two statments-one describing the results of
the null hypothesis and the other describing the results of the alternative hypothesis. The first
statement should state as to whether we accepted or rejected the null hypothesis and for what
value of alpha or p-value for our test statistic. The second statement should answer the
research question proposed in step 1 stating the sample statistic collected which estimated the
parameter we hypothesized.
Example:
Accept the null hypothesis at alpha=.05 or p-value of .096. Based on a sample mean of
$25,000, the mean salary of a newly graduated student does not equal $30,000.
If you learn these five basic steps, it will help you greatly in hypothesis testing. It gives you a
procedure to follow, regardless of the particular problem you are working with.
Now let's go through the five steps for our gas prices example. We have already done each of
these steps, but now we are doing them more explicitly in terms of the stages.
Making Assumptions
In hypothesis testing we make assumptions about the level of measurement of the variable,
the sampling method, the shape of the population distribution, and the sample size. In our
example, we made these assumptions:
1. We used a random sample.
2. Our variable, price, is at the interval-ratio level of measurement.
3. N > 50, so we need not assume a normal population.