1. Sampling Distribution of If and are normally distributed and samples 1 and 2 are independent, their difference is

2. Sampling Distribution of If and are normally distributed and samples 1 and 2 are independent, their difference is The normal distribution is not used if   and   are unknown. The t-distribution is used instead with

3. Sampling Distribution of n 1 p 1 > 5 n 1 (1  p 1 ) > 5 n 2 p 2 > 5 n 2 (1  p 2 ) > 5 If and are normally distributed and samples 1 and 2 are independent, their difference is The sample proportions are pooled (averaged) when testing the equality of proportions.

4. Sampling Distribution of If and are normally distributed and samples 1 and 2 are independent, their difference is The sample proportions are pooled (averaged) when testing whether the proportions are equal or not.

5. In a test of driving distance using a mechanical driving device, a sample of Par golf balls was compared with a sample of golf balls made by Rap, Ltd., a competitor. The sample statistics appear on the next slide. Par, Inc. is a manufacturer of golf equipment and has developed a new golf ball that has been designed to provide “extra distance.” Example 1 Interval estimate of

6. Sample Size Sample Mean Sample #1 Par, Inc. Sample #2 Rap, Ltd. 120 balls 80 balls 275 yards 258 yards Based on data from previous driving distance tests, the two population standard deviations are 15 and 20 yards, respectively. Develop a 95% confidence interval estimate of the difference between the mean driving distances of the two brands of golf balls. x 1  x 2 = 275 – 258 = 17 Example 1 Interval estimate of

7. 17 + 5.14 yards 11.86 yards to 22.14 yards We are 95% confident that the difference between the mean driving distances of Par and Rap golf balls is between 11.86 to 22.14 yards. Example 1 Interval estimate of

8. Specific Motors of Detroit has developed the M car. 24 M cars and 28 J cars (from Japan) were road tested to compare miles-per-gallon (MPG) performance. The sample statistics are given below. Develop a 90% confidence interval estimate of the difference between the MPG performances of the two models of automobile. Example 2 n M CarsJ Cars 24 cars 2 8 cars 29.8 mpg 27.3 mpg 2.56 mpg 1.81 mpg Point estimate of  1   2 = 29.8 – 27.3 = 2.5 MPG = x 1 – x 2 x s Interval estimate of

9. The degrees of freedom are: With 1  =.9000 t.0500 = 1.684  /2 = df =  =.1000 (the row of t-table).0500(the column of t -table) 40 -t.0500 = -1.684 Example 2 Interval estimate of

10. 2.5 + 1.051 1.448 to 3.552 mpg We are 90% confident that the difference between the MPG performances of M cars and J cars is 1.448 to 3.552 mpg Example 2 Interval estimate of

11. 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. The new campaign has been initiated with TV and newspaper advertisements running for three weeks. A survey conducted immediately after the new campaign showed 120 of 250 households “aware” of the client’s product. Develop a 95% confidence interval estimate of the difference between the proportion of households that are aware of the client’s product. Example 3 Interval estimate of

12. z.0250 = 1.96.08 +.10 1  =.9500  /2 =  =.0500.0250 Example 3 Interval estimate of We are 95% confident that the “change in awareness” due to the campaign is between -0.02 and 0.18…

13. Can we conclude, using a 5% level of significance, that the mean driving distance of Par, Inc. golf balls is greater than the mean driving distance of Rap, Ltd. golf balls? Hypothesis Tests About  1   2 H a :  1 –  2 > 0 1. Develop the hypotheses. H 0 :  1 –  2 < 0 Example 1 (continued)

14. 2.Determine the critical value  =.0500 3. Compute the value of the test statistic. .0500 z.0500 = 1.645 Hypothesis Tests About  1   2

15. Do Not Reject H 0 Reject H 0 z 1.645 6.49 z-stat 0 At the 5% level of significance, the sample evidence indicates the mean driving distance of Par, Inc. golf balls is greater than the mean driving distance of Rap, Ltd. golf balls. 4. Reject or do not reject the null hypothesis Hypothesis Tests About  1   2

16. Can we conclude, using a 5% level of significance, that the miles-per-gallon (MPG) performance of M cars is greater than the MPG performance of J cars? Recall Hypothesis Tests About  1   2 n M CarsJ Cars 24 cars 2 8 cars 29.8 mpg 27.3 mpg 2.56 mpg 1.81 mpg x s 1. Develop the hypotheses. H 0 :  1 -  2 < 0 H a :  1 -  2 > 0 Example 2 (continued)

17.  =.050 (column) t. 050 = 1.684 df = 40 (row) Hypothesis Tests About  1   2 3. Compute the value of the test statistic. 2.Determine the critical value.

18. Do Not Reject H 0 Reject H 0 t 1.684 t 050 4.003 t-stat 0 At 5% significance, fuel economy of M cars is greater than the mean fuel economy of J cars. 4. Reject or do not reject the null hypothesis Hypothesis Tests About  1   2

19. Can we conclude, using a 5% 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 Example 3 (continued) 1. Develop the hypotheses. H 0 : p 1  p 2 < 0 H a : p 1  p 2 > 0 2. Determine the critical value.   =.0500 z.05 = 1.645 3. Compute the value of the test statistic.

20. z Do Not Reject H 0 Reject H 0 0 We cannot conclude that the proportion of households aware of the client’s product increased after the new campaign. 1.57 z -stat 1.645 z.050 4. Reject or do not reject the null hypothesis Hypothesis Tests About p 1  p 2

21. John is a political candidate who wants to know if female support for his candidacy is the same as his male support using a 5% level of significance. A survey conducted shows 310 of 620 females surveyed said they will vote for John while the same survey said 362 of 680 males said they will vote for John. Hypothesis Tests About p 1  p 2 Example 4 1. Develop the hypotheses. H a : p 1  p 2 ≠ 0 H 0 : p 1  p 2 = 0

22. 2. Determine the critical value. 3. Compute the value of the test statistic.  =.0500 .0250 ± z.0250 = ± 1.96 Hypothesis Tests About p 1  p 2

23. -1.96 1.96 1 – a =.9700 0 4. Reject or do not reject the null hypothesis -1.15 z -stat Reject H 0 Do Not Reject H 0 Reject H 0 We cannot conclude that support from female voters is different from support from male voters. Hypothesis Tests About p 1  p 2

24. Example: Express Deliveries 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. 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 5% level of significance. Matched Samples

25. 32 30 19 16 15 18 14 10 7 16 25 24 15 13 15 8 9 11 UPXINTEXDifference (d)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 Sum = 27 Matched Samples

26. 7 6 4 1 2 3 2 -2 5 7– 2.7 6 – 2.7 4 – 2.7 1 – 2.7 2 – 2.7 3 – 2.7 -1 – 2.7 2 – 2.7 -2 – 2.7 5 – 2.7 4.3 3.3 1.3 -1.7 -0.7 0.3 -3.7 -0.7 -4.7 2.3 18.49 10.89 1.69 2.89 0.49 0.09 13.69 0.49 22.09 5.29 Sum = 76.1 s d = 8.5 s d = 2.9 2 Matched Samples

27. H 0 :  d = 0 with  d =  1 –  2 1. Develop the hypotheses A difference exists No difference exists 2. Determine the critical values with  =.050.  =.025 (the column of the t-table) df = 10 – 1 = 9 Since this is a two-tailed test  t.025 =  2.262 t.025 = 2.262 (the row of the t-table)  H a :  d  3. Compute the value of the test statistic. Matched Samples

28.  2.262 2.262  t.025 t.025 2.94 t-stat 0 At the 5% level of significance, the sample evidence indicates there is a difference in mean delivery times for the two services. Reject H 0 Do Not Reject Reject H 0 H 0 :  d = 0 4. Reject or do not reject the null hypothesis Matched Samples