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Hypothesis Testing: Means - Excel definitions

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  • Population Mean
    Central value expected for an entire group, often denoted by the Greek letter μ and used as a reference in hypothesis testing.
  • Null Hypothesis
    Initial assumption stating no effect or difference, typically that the population mean equals a specified value.
  • Alternative Hypothesis
    Statement representing the claim being tested, suggesting the population mean differs from the expected value.
  • Population Standard Deviation
    Measure of spread for an entire group, symbolized by sigma, used when known to apply the Z.TEST function.
  • Sample Mean
    Average value calculated from collected data, often used as an estimate for the population mean.
  • Sample Size
    Number of observations in a dataset, denoted by n, crucial for calculations in hypothesis testing.
  • Degrees of Freedom
    Value representing the number of independent data points minus one, important for t distribution calculations.
  • Sample Standard Deviation
    Statistic measuring variability within collected data, used when population standard deviation is unknown.
  • Z.TEST Function
    Excel tool that computes right-tail p-values directly from sample data, expected mean, and known sigma.
  • T Distribution
    Probability distribution used when sigma is unknown, relying on sample statistics and degrees of freedom.
  • T Score
    Calculated value comparing sample mean to expected mean, adjusted for sample variability and size.
  • P Value
    Probability indicating how extreme sample results are under the null hypothesis, guiding decision-making.
  • Significance Level
    Threshold, often denoted by alpha, used to determine whether to reject the null hypothesis.
  • Right-Tail Test
    Hypothesis test where the alternative suggests the population mean is greater than the expected value.
  • Left-Tail Test
    Hypothesis test where the alternative suggests the population mean is less than the expected value.