13 SBE11e PPT Ch10b

Slides by
John
Loucks
St. Edward’s
University
© 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied
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or duplicated, or posted to a publicly accessible website, in whole or in part.
Chapter 10, Part B
Inference About Means and Proportions
with Two Populations
 Inferences About the Difference Between

Two Population Proportions
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Inferences About the Difference Between
 Interval Estimation of p1 - p2
 Hypothesis Tests About p1 - p2
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Sampling Distribution of p1  p2
 Expected Value
E ( p1  p2 )  p1  p2
 Standard Deviation (Standard Error)
p1 (1  p1 ) p2 (1  p2 )
 p1  p2  
n1 n2
where: n1 = size of sample taken from population 1

n2 = size of sample taken from population 2
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If
If the
the sample
sample sizes
sizes are
are large,
large, the
the sampling
sampling distribution
distribution
of p1  p2 can
of can be
be approximated
approximated by by aa normal
normal probability
probability
distribution.
distribution.
The
The sample
sample sizes
sizes are
are sufficiently
sufficiently large
large if
if all
all of
of these
these
conditions
conditions are
are met:
met:
n1p1 > 5 n1(1 - p1) > 5
n2p2 > 5 n2(1 - p2) > 5
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p1 (1  p1 ) p2 (1  p2 )
 p1  p2  
n1 n2
p1  p2
p1 – p2
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Interval Estimation of p1 - p2
 Interval Estimate
p1 (1 p1 ) p2 (1 p2 )
p1  p2  z / 2 
n1 n2
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 Example: Market Research Associates

Market Research Associates is conducting research
to evaluate the effectiveness of a client’s new adver-
tising 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.
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A survey conducted immediately after the new
campaign showed 120 of 250 households “aware” of
the client’s product.
Does the data support the position that the
advertising campaign has provided an increased
awareness of the client’s product?
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Point Estimator of the Difference Between
p1 = proportion of the population of households
“aware” of the product after the new campaign
“aware” of the product before the new campaign
p1 = sample proportion of households “aware” of the
product after the new campaign
p2 = sample proportion of households “aware” of the
product before the new campaign
120 60
p1  p 2    .48  .40  .08
250 150
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For = .05, z.025 = 1.96:
.48(.52) .40(.60)
.48  .40  1.96 
250 150
.08 + 1.96(.0510)
.08 + .10
Hence, the 95% confidence interval for the difference

in before and after awareness of the product is
-.02 to +.18.
Note: In this case, the slide uses sample estimates rather than
population values. Can use combined value as well.
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Hypothesis Tests about p1 - p2
 Hypotheses
We focus on tests involving no difference between
the two population proportions (i.e. p1 = p2)
H0 : p1  p2  0 H
H00:: pp11 -pp22 < 00 H0: p1  p2  0
Ha: p1  p2  0 H
Ha:: pp1 -pp2 > 00 Ha: p1  p2  0
a 1 2
Left-tailed Right-tailed Two-tailed
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 Standard Error of p1  p2 when p1 = p2 = p
1 1
 p1 p2  p(1 p)   
 n1 n2 
 Pooled Estimator of p when p1 = p2 = p
n1 p1  n2 p2
p
n1  n2
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 Test Statistic
( p1  p2 )
z
 1 1 
p (1  p )   
n
 1 n 2 
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Can we conclude, using a .05 level of significance,
that the proportion of households aware of the
client’s product increased after the new advertising
campaign?
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 p -Value and Critical Value Approaches
1. Develop the hypotheses. H0: p1 - p2 < 0

Ha: p1 - p2 > 0
“aware” of the product after the new campaign
“aware” of the product before the new campaign
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 p -Value and Critical Value Approaches
2. Specify the level of significance. a = .05
3. Compute the value of the test statistic.

250(. 48)  150(. 40) 180
p  . 45
250  150 400
s p1  p2  . 45(. 55)( 1  1 ) . 0514

250 150
(.48  .40)  0 .08
z   1.56
.0514 .0514
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 p –Value Approach
4. Compute the p –value.
For z = 1.56, the p–value = .0594
5. Determine whether to reject H0.

Because p–value > a = .05, we cannot reject H0.
We cannot conclude that the proportion of households
aware of the client’s product increased after the new
campaign.
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 Critical Value Approach

4. Determine the critical value and rejection rule.
For a = .05, z.05 = 1.645

Reject H0 if z > 1.645
5. Determine whether to reject H0.

Because 1.56 < 1.645, we cannot reject H0.
We cannot conclude that the proportion of households
aware of the client’s product increased after the new
campaign.
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End of Chapter 10
Part B
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13 SBE11e PPT Ch10b

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 Inferences About the Difference Between

 Standard Deviation (Standard Error)

where: n1 = size of sample taken from population 1

n2p2 > 5 n2(1 - p2) > 5

 Example: Market Research Associates

 Example: Market Research Associates

For = .05, z.025 = 1.96:

Hence, the 95% confidence interval for the difference

Left-tailed Right-tailed Two-tailed

 Standard Error of p1  p2 when p1 = p2 = p

 Pooled Estimator of p when p1 = p2 = p

 Example: Market Research Associates

 p -Value and Critical Value Approaches

1. Develop the hypotheses. H0: p1 - p2 < 0

 p -Value and Critical Value Approaches

2. Specify the level of significance. a = .05

3. Compute the value of the test statistic.

s p1  p2  . 45(. 55)( 1  1 ) . 0514

For z = 1.56, the p–value = .0594

5. Determine whether to reject H0.

 Critical Value Approach

For a = .05, z.05 = 1.645

5. Determine whether to reject H0.

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