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Statistics for Decision- Making in Business - Maricopa Community ...

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S<strong>in</strong>ce this is a mathematical question, we would want to <strong>for</strong>mulate our hypothesis <strong>in</strong>to<br />

mathematical statements.<br />

S<strong>in</strong>ce we are deal<strong>in</strong>g with an average <strong>in</strong> this scenario, the statistical symbol often used to<br />

represent the average plant yield <strong>for</strong> the entire population of this particular vegetable is the<br />

Greek letter Mu, .<br />

Now, our experimental hypothesis is that pesticides damage the soil, measured by the pounds of<br />

vegetables yielded from these plants. If that is the case, we would expect to see a yield of less<br />

than 30 lbs. of fruit per plant. That is, our hypothesis is that<br />

S<strong>in</strong>ce this is the experimental hypothesis, we have no evidence to conclude that this is true. Thus,<br />

we should probably assume that there is no difference between the yields of pesticide-sprayed<br />

and non-sprayed plants. Thus, beg<strong>in</strong> by assum<strong>in</strong>g that:<br />

This second hypothesis is called the null hypothesis, that is, the hypothesis that is assumed until<br />

there is sufficient evidence otherwise. Symbolically, this hypothesis is written and is typically<br />

read as “null hypothesis,” or “h-naught.”<br />

The hypothesis that we believe is called the alternative hypothesis, and is written<br />

, or “h-ay.”<br />

To write these two hypotheses, we would write:<br />

When evidence is <strong>in</strong>sufficient, we say<br />

“Based on sample data, we fail to reject <strong>in</strong> favor of ”<br />

When evidence is sufficient to conclude that the average is really below 30, we say<br />

“Based on sample evidence, we reject <strong>in</strong> favor of ”<br />

We are cautious to make these conclusions based on sample data. Certa<strong>in</strong>ly, we may have<br />

obta<strong>in</strong>ed an oddball sample that doesn‟t represent the population.<br />

Let‟s practice writ<strong>in</strong>g some hypotheses. First, off, let‟s make note of the variety of population<br />

characteristics, called population parameters, that we can seek to describe <strong>in</strong> a study.<br />

<strong>Statistics</strong> <strong>for</strong> <strong>Decision</strong>-<strong>Mak<strong>in</strong>g</strong> <strong>in</strong> Bus<strong>in</strong>ess © Milos Podmanik Page 209

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