ECON 203 1st Edition Discussion - Lecture 2Outline of Last LectureI. Descriptive Statistics Review1. Population2. SampleII. Descriptive Statistics Measurements1. Central Tendency Measurei. Meanii. Medianiii. Mode2. Example Slide 9i. #1ii. #23. Dispersioni. Rangeii. Variance iii. Standard Deviation4. Linear Associationi. Covarianceii. Correlation CoefficientIII. Skewed Graphs1. Right2. LefIV. Empirical RuleOutline of Current Discussion LectureI. Review of key class features1. Office Hours 2. HomeworkII. Aplia Homework 21. Hypothesis Testing, Example 12i. Relevant Point Estimateii. Value of Test Statisticiii. P-valueiv. Type I error conclusionCurrent Discussion LectureThese notes represent a detailed interpretation of the professor’s lecture. GradeBuddy is best used as a supplement to your own notes, not as a substitute.I. Review of key class features1. Office hours - Posted this week and will be Monday – Thursday- TA’s will be rotating office hours2. Homework- Afer this week there will be only one homework assignment due each week of the semesterII. Aplia Homework 21. Hypothesis Testing, Example 12i. Relevant point estimate- This variable is found by taking the number of customers who purchased the glass and divide it by the total- 151/950 = .1589 … = .159ii. Value of Test Statistic- Use the “z” variable equation- P = .15 because that is the population standard- Z = (p-hat – p)/ sqrt((p(1-p))/n)- Z = (.159 - .15)/sqrt((.15*.85)/950) = .7723iii. P-value- All tests about proportion use a z statistic, so this test statistic follows a standard normal distribution- In excel put =NORMSDIST(z) . This will return the area to the lef of “z”- NORMSDIST(.7723) = .7800 …. 1-.7800 = .2200iv. Type I error conclusion- Allowing for a 5% chance of error- Which means that 95% of the experiment must be correct in order for the company to pursue this line of cartoon mugs- Do not reject the null hypothesis, and conclude that there is insufficient evidence that the special offer should be introduced- The p-value is not less than alpha=.05, therefore conclude that there is insufficient evidence that the special offer should be
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