Comparing two Groups

M.Thenmozhi Professor Department of Management Studies IIT Madras mtm@iitm.ac.in

Two groups
Dependent groups
t test, Z test Comparing mean, proportion

Independent groups
t test, Z test
Comparing mean, proportion

F test compare variance

1/16/2014 DoMS, IITM mtm@iitm.ac.in 3

Two or more groups

One way ANOVA Two-way ANOVA Latin Square Experimentation MANOVA

1/16/2014

DoMS, IITM

mtm@iitm.ac.in

Analysis of Variance
Mathematical technique

Partitioning the total variation of a set of data

To identify the sources of variation

BSS Deviation caused by the influence of the stimulus or treatment with a group.
Deviation TSS WSS Deviation due to chance - Unexplained

BSS=0 when group means are similar WSS=0 when all the observations within the group is the same
1/16/2014 DoMS, IITM mtm@iitm.ac.in 5

Is there significant difference between colour of the package and sales made?

1/16/2014

DoMS, IITM

mtm@iitm.ac.in

ANOVA Table
Source of Degrees of Variability Freedom
BSS
WSS

Sum of squares
32
26

Mean F squares
32/2 = 16
26/9 = 2.88 16/2.88 = 5.54

2
9

TSS

11

58

F(2,9) = 4.26 Degrees of Freedom.

TSS = Total observation 1 = (Kxn) 1 BSS = K-1
1/16/2014 DoMS, IITM mtm@iitm.ac.in

WSS = k(n-1)
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Is there significant difference between size of the store and sales technique used on sales made?

1/16/2014

DoMS, IITM

mtm@iitm.ac.in

TWO-WAY ANOVA
Sales Technique (000 p.week)

Size of store I Large II Medium III Small

TSS =
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A 20 16 12
SSR +

B 25 18 14
SSC +

C 23 20 16
SSE

D 22 19 15

Variation Between rows

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Variation
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Residual variation due to chance

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between columns

ANOVA TABLE Sources of variation SSC SSR SSE SS 23.34 136.17 7.16 D.f. 3 2 6 Mean Variance Square Ratio 7.78 F1 =7.78/1.19 68.09 = 6.54 F2 1.19 = 68.09/1.19 = 57.2
F2,6 (0.05) = 5.1
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F3,6 (0.05) = 4.67

1/16/2014

Is there significant difference between size of the store, time period and colour of the package on sales made?

1/16/2014

DoMS, IITM

mtm@iitm.ac.in

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Latin Square Design

Test four different colour packages during four time in four stores Store

Time Period I

1 D=24

2 C=23

3 A=15

4 B=81

II
III

C=20
A=18

B=20
D=22

D=23
B=17

A=80
C=76

IV
1/16/2014

B=16

A=19

C=20
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D=75
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DoMS, IITM

Source

ANOVA Table Df. SS MS

Between package colours

Between time periods Between stores Error
H01 : A = B =

3
3 3 6

63.5
6.5 13.5 16.5

21.2
2.2 4.5 2.8

F1 = 7.6 F2 = .79

F3 = 1.6 F(3,6) (0.05) = 4.76

C = D

Not Accepted

H02 : I = II =
H031/16/2014 : 1 = 2 =

III = IV
3 = 4 DoMS, IITM

Accepted
mtm@iitm.ac.in

Accepted

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