Quantitative Methods - Hypothesis Testing - Mean Differences and Differences in Means

Question 1

what is a difference in means test?

Answer 1

test for samples from two independent normal populations

Question 2

when do you use a mean differences test?

Answer 2

to test for two different, equal-size, samples from normal populations (aka paired comparison)

• the samples used are dependent

Question 3

what is the rule of rejection for both differences in means and mean differences tests?

Answer 3

t-stat is rejected if it’s greater/less than critical values

Question 4

what do we assume is equal when calculating t-stat for differences in means?

Answer 4

variance

Question 5

when calculating a paired comparison test, what are the degrees of freedom?

Answer 5

n-1

Question 6

when would you use a paired comparison test?

Answer 6

if the oberservations in two samples both depend of some other factor (e.g. market)