Chapter Ten

Nonparametric Methods: Analysis of Ranked Data

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GOALS When you have completed this chapter, you will be able to: ONE Conduct a test of hypothesis for dependent samples using the Wilcoxon signed-rank test. TWO Conduct and interpret the Wilcoxon rank-sum test for independent samples. THREE Conduct and interpret the Kruskal-Wallis test for several independent samples.

Nonparametric Methods: Analysis of Ranked Data

continued Chapter Sixteen

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GOALS When you have completed this chapter, you will be able to: FIVE Compute and interpret Spearmans coefficient of rank correlation. SIX Conduct a test of hypothesis to determine whether the correlation among the ranks in the population is different from zero.

Goals

Wilcoxon Signed-Rank Test

Use if assumption of normality is violated for the paired-t test Requires the ordinal scale of measurement

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The observations must be related or dependent.

Wilcoxon Signed-Rank Test

Wilcoxon Signed-Rank Test

Compute the differences between related observations. Rank the absolute differences from low to high.

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Return the signs to the ranks and sum positive and negative ranks.

Compare the smaller of the two rank sums with the T value, obtained from Appendix H.

Wilcoxon Signed-Rank Test

From Example 1 Have R&D expenses declined as a percent of income? Use .05 significance level.

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Step 1: H0: The percent stayed the same. H1: The percent declined.

Step 2 H0 is rejected if the smaller of the rank sums is less than or equal to 5. See Appendix H.

Example 3

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Company

Savoth Glass 20 Ruisi Glass 14 Rubin Inc.23 20 Vaught 24 17 Lambert Glass Pimental 22 20 Olson Glass 14 Flynn Glass 18

2000

16 13 3 7 31 2 20 11

2001 Difference ABS-Diff Rank R+ R-

4 1 3 7 22 2 -6 7

4 1 3 7 9 2 6 7

4 1 3 7 9 2 5 6

4 1 * * 8 * * 6

* * 8 5 *

The smaller rank sum is 5, which is equal to the critical value of T. H0 is rejected. The percent has declined from one year to the next.

Example 3 Continued

Wilcoxon Rank-Sum Test

Used to determine if two independent samples came from the same or equal populations No assumption about the shape of the population is required

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Each sample must contain at least eight observations

The data must be at least ordinal scale

Wilcoxon Rank-Sum Test

Wilcoxon Rank-Sum Test

Rank all data values from low to high as if they were from a single population Determine the sum of ranks for each of the two samples

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Use the smaller of the two sums W to compute the test statistic

Wilcoxon Rank-Sum Test

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Hills Community College purchased two vehicles, a Ford and a Chevy, for the administrations use when traveling. The repair costs for the two cars over the last three years is shown on the next slide. At the .05 significance level is there a difference in the two distributions?

Example 4

Ford ($) 25.31 33.68 46.89 51.83 87.65 87.90 90.89 120.67

Rank Chevy($) Rank 3.0 14.89 1.0 5.5 20.31 2.0 7.0 25.97 4.0 8.0 33.68 5.5 13.0 68.98 9.0 14.0 78.23 10.0 15.0 80.31 11.0 16.0 81.75 12.0 157.90 17.0 81.50 71.5

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Example 4

Step 1: H0: The populations are the same. H1: The populations are not the same.

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Step 2: H0 is rejected if z >1.96 or z is less than 1.96

Step 3: The value of the test statistic is 0.914.

Step 4: We do not reject the null hypothesis. We cannot conclude that there is a difference in the distributions of the repair costs of the two vehicles.

Example 4

Used to compare three or more samples to determine if they came from equal populations It is an alternative to the one-way ANOVA

Kruskal-Wallis Test Analysis of Variance by Ranks

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The ordinal scale of measurement is required

The sample data is ranked from low to high as if it were a single group

Each sample should have at least five observations

The chi-square distribution is the test statistic

Kruskal-Wallis Test: Analysis of Variance by Ranks

Kruskal-Wallis Test Analysis of Variance by Ranks Test Statistic

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( Rk ) 2 12 ( R1 ) 2 ( R2 ) 2 H= + + ...+ 3(n + 1) n(n + 1) n1 n2 nk

Kruskal-Wallis Test: Analysis of Variance by Ranks continued

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Keely Ambrose, director of Human Resources for Miller Industries, wishes to study the percent increase in salary for middle managers at the four manufacturing plants. She gathers a sample of managers and determines the percent increase in salary from last year to this year. At the 5% significance level can Keely conclude that there is a difference in the percent increases for the various plants?

Example 5

Ranked Increases in Managers Salaries

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EXAMPLE 5

continued

Step 1: H0: The populations are the same. H1: The populations are not the same.

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Step 2: H0 is rejected if is greater than 7.185. There are 3 degrees of freedom at the .05 significance level.

The null hypothesis is not rejected.

There is no difference in the percent increases in manager salaries in the four plants.

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Spearmans Coefficient of Rank Correlation

Reports the association between two sets of ranked observations

Similar to Pearsons coefficient of correlation, but is based on ranked data.

Ranges from 1.00 up to 1.00 d is the difference in the ranks and n is the number of observations

Rank-Order Correlation

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Testing the Significance of rs Ho: Rank correlation in population is 0 H1: Rank correlation in population is not 0.
n 2 2 1 s r
Testing the Significance of rs

t =rs

Preseason Football Rankings for the Atlantic Coast Conference by the coaches and sports writers

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School Coaches Maryland 2 NC State 3 NC 6 Virginia 5 Clemson 4 Wake Forest 7 Duke 8 Florida State 1

Writers 3 4 6 5 2 8 1

Example 6 Continued

School Maryland NC State NC Virginia Clemson Wake Forest Duke Florida State Total

d 2 d Coaches Writers
3 6 5 4 7 1 2 4 6 5 2 8 8 1 3 -1 0 0 2 -1 7 0 -1 1 0 0 4 1 1 0 1

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d2

1 8

Example 6 continued

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Coefficient of Rank Correlation

rs = 1 = 1

6d
2

n(n 1) 6(8) 8(8 1)

2

= 0.905

There is a strong correlation between the ranks of the coaches and the sports writers.
Example 6
Continued