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• Null and Alternative Hypotheses | Definitions & Examples

Null & Alternative Hypotheses | Definitions, Templates & Examples

Published on May 6, 2022 by Shaun Turney . Revised on June 22, 2023.

The null and alternative hypotheses are two competing claims that researchers weigh evidence for and against using a statistical test :

• Null hypothesis ( H 0 ): There’s no effect in the population .
• Alternative hypothesis ( H a or H 1 ) : There’s an effect in the population.

Table of contents

Answering your research question with hypotheses, what is a null hypothesis, what is an alternative hypothesis, similarities and differences between null and alternative hypotheses, how to write null and alternative hypotheses, other interesting articles, frequently asked questions.

The null and alternative hypotheses offer competing answers to your research question . When the research question asks “Does the independent variable affect the dependent variable?”:

• The null hypothesis ( H 0 ) answers “No, there’s no effect in the population.”
• The alternative hypothesis ( H a ) answers “Yes, there is an effect in the population.”

The null and alternative are always claims about the population. That’s because the goal of hypothesis testing is to make inferences about a population based on a sample . Often, we infer whether there’s an effect in the population by looking at differences between groups or relationships between variables in the sample. It’s critical for your research to write strong hypotheses .

You can use a statistical test to decide whether the evidence favors the null or alternative hypothesis. Each type of statistical test comes with a specific way of phrasing the null and alternative hypothesis. However, the hypotheses can also be phrased in a general way that applies to any test.

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The null hypothesis is the claim that there’s no effect in the population.

If the sample provides enough evidence against the claim that there’s no effect in the population ( p ≤ α), then we can reject the null hypothesis . Otherwise, we fail to reject the null hypothesis.

Although “fail to reject” may sound awkward, it’s the only wording that statisticians accept . Be careful not to say you “prove” or “accept” the null hypothesis.

Null hypotheses often include phrases such as “no effect,” “no difference,” or “no relationship.” When written in mathematical terms, they always include an equality (usually =, but sometimes ≥ or ≤).

You can never know with complete certainty whether there is an effect in the population. Some percentage of the time, your inference about the population will be incorrect. When you incorrectly reject the null hypothesis, it’s called a type I error . When you incorrectly fail to reject it, it’s a type II error.

Examples of null hypotheses

The table below gives examples of research questions and null hypotheses. There’s always more than one way to answer a research question, but these null hypotheses can help you get started.

*Note that some researchers prefer to always write the null hypothesis in terms of “no effect” and “=”. It would be fine to say that daily meditation has no effect on the incidence of depression and p 1 = p 2 .

The alternative hypothesis ( H a ) is the other answer to your research question . It claims that there’s an effect in the population.

Often, your alternative hypothesis is the same as your research hypothesis. In other words, it’s the claim that you expect or hope will be true.

The alternative hypothesis is the complement to the null hypothesis. Null and alternative hypotheses are exhaustive, meaning that together they cover every possible outcome. They are also mutually exclusive, meaning that only one can be true at a time.

Alternative hypotheses often include phrases such as “an effect,” “a difference,” or “a relationship.” When alternative hypotheses are written in mathematical terms, they always include an inequality (usually ≠, but sometimes < or >). As with null hypotheses, there are many acceptable ways to phrase an alternative hypothesis.

Examples of alternative hypotheses

The table below gives examples of research questions and alternative hypotheses to help you get started with formulating your own.

Null and alternative hypotheses are similar in some ways:

• They’re both answers to the research question.
• They both make claims about the population.
• They’re both evaluated by statistical tests.

However, there are important differences between the two types of hypotheses, summarized in the following table.

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To help you write your hypotheses, you can use the template sentences below. If you know which statistical test you’re going to use, you can use the test-specific template sentences. Otherwise, you can use the general template sentences.

General template sentences

The only thing you need to know to use these general template sentences are your dependent and independent variables. To write your research question, null hypothesis, and alternative hypothesis, fill in the following sentences with your variables:

Does independent variable affect dependent variable ?

• Null hypothesis ( H 0 ): Independent variable does not affect dependent variable.
• Alternative hypothesis ( H a ): Independent variable affects dependent variable.

Test-specific template sentences

Once you know the statistical test you’ll be using, you can write your hypotheses in a more precise and mathematical way specific to the test you chose. The table below provides template sentences for common statistical tests.

Note: The template sentences above assume that you’re performing one-tailed tests . One-tailed tests are appropriate for most studies.

If you want to know more about statistics , methodology , or research bias , make sure to check out some of our other articles with explanations and examples.

• Normal distribution
• Descriptive statistics
• Measures of central tendency
• Correlation coefficient

Methodology

• Cluster sampling
• Stratified sampling
• Types of interviews
• Cohort study
• Thematic analysis

Research bias

• Implicit bias
• Cognitive bias
• Survivorship bias
• Availability heuristic
• Nonresponse bias
• Regression to the mean

Hypothesis testing is a formal procedure for investigating our ideas about the world using statistics. It is used by scientists to test specific predictions, called hypotheses , by calculating how likely it is that a pattern or relationship between variables could have arisen by chance.

Null and alternative hypotheses are used in statistical hypothesis testing . The null hypothesis of a test always predicts no effect or no relationship between variables, while the alternative hypothesis states your research prediction of an effect or relationship.

The null hypothesis is often abbreviated as H 0 . When the null hypothesis is written using mathematical symbols, it always includes an equality symbol (usually =, but sometimes ≥ or ≤).

The alternative hypothesis is often abbreviated as H a or H 1 . When the alternative hypothesis is written using mathematical symbols, it always includes an inequality symbol (usually ≠, but sometimes < or >).

A research hypothesis is your proposed answer to your research question. The research hypothesis usually includes an explanation (“ x affects y because …”).

A statistical hypothesis, on the other hand, is a mathematical statement about a population parameter. Statistical hypotheses always come in pairs: the null and alternative hypotheses . In a well-designed study , the statistical hypotheses correspond logically to the research hypothesis.

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Null Hypothesis Definition and Examples

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In a scientific experiment, the null hypothesis is the proposition that there is no effect or no relationship between phenomena or populations. If the null hypothesis is true, any observed difference in phenomena or populations would be due to sampling error (random chance) or experimental error. The null hypothesis is useful because it can be tested and found to be false, which then implies that there is a relationship between the observed data. It may be easier to think of it as a nullifiable hypothesis or one that the researcher seeks to nullify. The null hypothesis is also known as the H 0, or no-difference hypothesis.

The alternate hypothesis, H A or H 1 , proposes that observations are influenced by a non-random factor. In an experiment, the alternate hypothesis suggests that the experimental or independent variable has an effect on the dependent variable .

How to State a Null Hypothesis

There are two ways to state a null hypothesis. One is to state it as a declarative sentence, and the other is to present it as a mathematical statement.

For example, say a researcher suspects that exercise is correlated to weight loss, assuming diet remains unchanged. The average length of time to achieve a certain amount of weight loss is six weeks when a person works out five times a week. The researcher wants to test whether weight loss takes longer to occur if the number of workouts is reduced to three times a week.

The first step to writing the null hypothesis is to find the (alternate) hypothesis. In a word problem like this, you're looking for what you expect to be the outcome of the experiment. In this case, the hypothesis is "I expect weight loss to take longer than six weeks."

This can be written mathematically as: H 1 : μ > 6

In this example, μ is the average.

Now, the null hypothesis is what you expect if this hypothesis does not happen. In this case, if weight loss isn't achieved in greater than six weeks, then it must occur at a time equal to or less than six weeks. This can be written mathematically as:

H 0 : μ ≤ 6

The other way to state the null hypothesis is to make no assumption about the outcome of the experiment. In this case, the null hypothesis is simply that the treatment or change will have no effect on the outcome of the experiment. For this example, it would be that reducing the number of workouts would not affect the time needed to achieve weight loss:

H 0 : μ = 6

• Null Hypothesis Examples

"Hyperactivity is unrelated to eating sugar " is an example of a null hypothesis. If the hypothesis is tested and found to be false, using statistics, then a connection between hyperactivity and sugar ingestion may be indicated. A significance test is the most common statistical test used to establish confidence in a null hypothesis.

Another example of a null hypothesis is "Plant growth rate is unaffected by the presence of cadmium in the soil ." A researcher could test the hypothesis by measuring the growth rate of plants grown in a medium lacking cadmium, compared with the growth rate of plants grown in mediums containing different amounts of cadmium. Disproving the null hypothesis would set the groundwork for further research into the effects of different concentrations of the element in soil.

Why Test a Null Hypothesis?

You may be wondering why you would want to test a hypothesis just to find it false. Why not just test an alternate hypothesis and find it true? The short answer is that it is part of the scientific method. In science, propositions are not explicitly "proven." Rather, science uses math to determine the probability that a statement is true or false. It turns out it's much easier to disprove a hypothesis than to positively prove one. Also, while the null hypothesis may be simply stated, there's a good chance the alternate hypothesis is incorrect.

For example, if your null hypothesis is that plant growth is unaffected by duration of sunlight, you could state the alternate hypothesis in several different ways. Some of these statements might be incorrect. You could say plants are harmed by more than 12 hours of sunlight or that plants need at least three hours of sunlight, etc. There are clear exceptions to those alternate hypotheses, so if you test the wrong plants, you could reach the wrong conclusion. The null hypothesis is a general statement that can be used to develop an alternate hypothesis, which may or may not be correct.

• What Are Examples of a Hypothesis?
• What Is a Hypothesis? (Science)
• What 'Fail to Reject' Means in a Hypothesis Test
• What Are the Elements of a Good Hypothesis?
• Scientific Hypothesis Examples
• Null Hypothesis and Alternative Hypothesis
• What Is a Control Group?
• Understanding Simple vs Controlled Experiments
• Six Steps of the Scientific Method
• Scientific Method Vocabulary Terms
• Definition of a Hypothesis
• Type I and Type II Errors in Statistics
• An Example of a Hypothesis Test
• How to Conduct a Hypothesis Test
• Hypothesis Test Example

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• v.23(Suppl 3); 2019 Sep

An Introduction to Statistics: Understanding Hypothesis Testing and Statistical Errors

Priya ranganathan.

1 Department of Anesthesiology, Critical Care and Pain, Tata Memorial Hospital, Mumbai, Maharashtra, India

2 Department of Surgical Oncology, Tata Memorial Centre, Mumbai, Maharashtra, India

The second article in this series on biostatistics covers the concepts of sample, population, research hypotheses and statistical errors.

How to cite this article

Ranganathan P, Pramesh CS. An Introduction to Statistics: Understanding Hypothesis Testing and Statistical Errors. Indian J Crit Care Med 2019;23(Suppl 3):S230–S231.

Two papers quoted in this issue of the Indian Journal of Critical Care Medicine report. The results of studies aim to prove that a new intervention is better than (superior to) an existing treatment. In the ABLE study, the investigators wanted to show that transfusion of fresh red blood cells would be superior to standard-issue red cells in reducing 90-day mortality in ICU patients. 1 The PROPPR study was designed to prove that transfusion of a lower ratio of plasma and platelets to red cells would be superior to a higher ratio in decreasing 24-hour and 30-day mortality in critically ill patients. 2 These studies are known as superiority studies (as opposed to noninferiority or equivalence studies which will be discussed in a subsequent article).

SAMPLE VERSUS POPULATION

A sample represents a group of participants selected from the entire population. Since studies cannot be carried out on entire populations, researchers choose samples, which are representative of the population. This is similar to walking into a grocery store and examining a few grains of rice or wheat before purchasing an entire bag; we assume that the few grains that we select (the sample) are representative of the entire sack of grains (the population).

The results of the study are then extrapolated to generate inferences about the population. We do this using a process known as hypothesis testing. This means that the results of the study may not always be identical to the results we would expect to find in the population; i.e., there is the possibility that the study results may be erroneous.

HYPOTHESIS TESTING

A clinical trial begins with an assumption or belief, and then proceeds to either prove or disprove this assumption. In statistical terms, this belief or assumption is known as a hypothesis. Counterintuitively, what the researcher believes in (or is trying to prove) is called the “alternate” hypothesis, and the opposite is called the “null” hypothesis; every study has a null hypothesis and an alternate hypothesis. For superiority studies, the alternate hypothesis states that one treatment (usually the new or experimental treatment) is superior to the other; the null hypothesis states that there is no difference between the treatments (the treatments are equal). For example, in the ABLE study, we start by stating the null hypothesis—there is no difference in mortality between groups receiving fresh RBCs and standard-issue RBCs. We then state the alternate hypothesis—There is a difference between groups receiving fresh RBCs and standard-issue RBCs. It is important to note that we have stated that the groups are different, without specifying which group will be better than the other. This is known as a two-tailed hypothesis and it allows us to test for superiority on either side (using a two-sided test). This is because, when we start a study, we are not 100% certain that the new treatment can only be better than the standard treatment—it could be worse, and if it is so, the study should pick it up as well. One tailed hypothesis and one-sided statistical testing is done for non-inferiority studies, which will be discussed in a subsequent paper in this series.

STATISTICAL ERRORS

There are two possibilities to consider when interpreting the results of a superiority study. The first possibility is that there is truly no difference between the treatments but the study finds that they are different. This is called a Type-1 error or false-positive error or alpha error. This means falsely rejecting the null hypothesis.

The second possibility is that there is a difference between the treatments and the study does not pick up this difference. This is called a Type 2 error or false-negative error or beta error. This means falsely accepting the null hypothesis.

The power of the study is the ability to detect a difference between groups and is the converse of the beta error; i.e., power = 1-beta error. Alpha and beta errors are finalized when the protocol is written and form the basis for sample size calculation for the study. In an ideal world, we would not like any error in the results of our study; however, we would need to do the study in the entire population (infinite sample size) to be able to get a 0% alpha and beta error. These two errors enable us to do studies with realistic sample sizes, with the compromise that there is a small possibility that the results may not always reflect the truth. The basis for this will be discussed in a subsequent paper in this series dealing with sample size calculation.

Conventionally, type 1 or alpha error is set at 5%. This means, that at the end of the study, if there is a difference between groups, we want to be 95% certain that this is a true difference and allow only a 5% probability that this difference has occurred by chance (false positive). Type 2 or beta error is usually set between 10% and 20%; therefore, the power of the study is 90% or 80%. This means that if there is a difference between groups, we want to be 80% (or 90%) certain that the study will detect that difference. For example, in the ABLE study, sample size was calculated with a type 1 error of 5% (two-sided) and power of 90% (type 2 error of 10%) (1).

Table 1 gives a summary of the two types of statistical errors with an example

Statistical errors

In the next article in this series, we will look at the meaning and interpretation of ‘ p ’ value and confidence intervals for hypothesis testing.

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Conflict of interest: None

Statistics Made Easy

How to Write a Null Hypothesis (5 Examples)

A hypothesis test uses sample data to determine whether or not some claim about a population parameter is true.

Whenever we perform a hypothesis test, we always write a null hypothesis and an alternative hypothesis, which take the following forms:

H 0 (Null Hypothesis): Population parameter =,  ≤, ≥ some value

H A  (Alternative Hypothesis): Population parameter <, >, ≠ some value

Note that the null hypothesis always contains the equal sign .

We interpret the hypotheses as follows:

Null hypothesis: The sample data provides no evidence to support some claim being made by an individual.

Alternative hypothesis: The sample data  does provide sufficient evidence to support the claim being made by an individual.

For example, suppose it’s assumed that the average height of a certain species of plant is 20 inches tall. However, one botanist claims the true average height is greater than 20 inches.

To test this claim, she may go out and collect a random sample of plants. She can then use this sample data to perform a hypothesis test using the following two hypotheses:

H 0 : μ ≤ 20 (the true mean height of plants is equal to or even less than 20 inches)

H A : μ > 20 (the true mean height of plants is greater than 20 inches)

If the sample data gathered by the botanist shows that the mean height of this species of plants is significantly greater than 20 inches, she can reject the null hypothesis and conclude that the mean height is greater than 20 inches.

Read through the following examples to gain a better understanding of how to write a null hypothesis in different situations.

Example 1: Weight of Turtles

A biologist wants to test whether or not the true mean weight of a certain species of turtles is 300 pounds. To test this, he goes out and measures the weight of a random sample of 40 turtles.

Here is how to write the null and alternative hypotheses for this scenario:

H 0 : μ = 300 (the true mean weight is equal to 300 pounds)

H A : μ ≠ 300 (the true mean weight is not equal to 300 pounds)

Example 2: Height of Males

It’s assumed that the mean height of males in a certain city is 68 inches. However, an independent researcher believes the true mean height is greater than 68 inches. To test this, he goes out and collects the height of 50 males in the city.

H 0 : μ ≤ 68 (the true mean height is equal to or even less than 68 inches)

H A : μ > 68 (the true mean height is greater than 68 inches)

Example 3: Graduation Rates

A university states that 80% of all students graduate on time. However, an independent researcher believes that less than 80% of all students graduate on time. To test this, she collects data on the proportion of students who graduated on time last year at the university.

H 0 : p ≥ 0.80 (the true proportion of students who graduate on time is 80% or higher)

H A : μ < 0.80 (the true proportion of students who graduate on time is less than 80%)

Example 4: Burger Weights

A food researcher wants to test whether or not the true mean weight of a burger at a certain restaurant is 7 ounces. To test this, he goes out and measures the weight of a random sample of 20 burgers from this restaurant.

H 0 : μ = 7 (the true mean weight is equal to 7 ounces)

H A : μ ≠ 7 (the true mean weight is not equal to 7 ounces)

Example 5: Citizen Support

A politician claims that less than 30% of citizens in a certain town support a certain law. To test this, he goes out and surveys 200 citizens on whether or not they support the law.

H 0 : p ≥ .30 (the true proportion of citizens who support the law is greater than or equal to 30%)

H A : μ < 0.30 (the true proportion of citizens who support the law is less than 30%)

Additional Resources

Introduction to Hypothesis Testing Introduction to Confidence Intervals An Explanation of P-Values and Statistical Significance

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Once you have developed a clear and focused research question or set of research questions, you’ll be ready to conduct further research, a literature review, on the topic to help you make an educated guess about the answer to your question(s). This educated guess is called a hypothesis.

In research, there are two types of hypotheses: null and alternative. They work as a complementary pair, each stating that the other is wrong.

• Null Hypothesis (H 0 ) – This can be thought of as the implied hypothesis. “Null” meaning “nothing.”  This hypothesis states that there is no difference between groups or no relationship between variables. The null hypothesis is a presumption of status quo or no change.
• Alternative Hypothesis (H a ) – This is also known as the claim. This hypothesis should state what you expect the data to show, based on your research on the topic. This is your answer to your research question.

Null Hypothesis:   H 0 : There is no difference in the salary of factory workers based on gender. Alternative Hypothesis :  H a : Male factory workers have a higher salary than female factory workers.

Null Hypothesis :  H 0 : There is no relationship between height and shoe size. Alternative Hypothesis :  H a : There is a positive relationship between height and shoe size.

Null Hypothesis :  H 0 : Experience on the job has no impact on the quality of a brick mason’s work. Alternative Hypothesis :  H a : The quality of a brick mason’s work is influenced by on-the-job experience.

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8.1: The Elements of Hypothesis Testing

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Learning Objectives

• To understand the logical framework of tests of hypotheses.
• To learn basic terminology connected with hypothesis testing.
• To learn fundamental facts about hypothesis testing.

Types of Hypotheses

A hypothesis about the value of a population parameter is an assertion about its value. As in the introductory example we will be concerned with testing the truth of two competing hypotheses, only one of which can be true.

Definition: null hypothesis and alternative hypothesis

• The null hypothesis , denoted \(H_0\), is the statement about the population parameter that is assumed to be true unless there is convincing evidence to the contrary.
• The alternative hypothesis , denoted \(H_a\), is a statement about the population parameter that is contradictory to the null hypothesis, and is accepted as true only if there is convincing evidence in favor of it.

Definition: statistical procedure

Hypothesis testing is a statistical procedure in which a choice is made between a null hypothesis and an alternative hypothesis based on information in a sample.

The end result of a hypotheses testing procedure is a choice of one of the following two possible conclusions:

• Reject \(H_0\) (and therefore accept \(H_a\)), or
• Fail to reject \(H_0\) (and therefore fail to accept \(H_a\)).

The null hypothesis typically represents the status quo, or what has historically been true. In the example of the respirators, we would believe the claim of the manufacturer unless there is reason not to do so, so the null hypotheses is \(H_0:\mu =75\). The alternative hypothesis in the example is the contradictory statement \(H_a:\mu <75\). The null hypothesis will always be an assertion containing an equals sign, but depending on the situation the alternative hypothesis can have any one of three forms: with the symbol \(<\), as in the example just discussed, with the symbol \(>\), or with the symbol \(\neq\). The following two examples illustrate the latter two cases.

Example \(\PageIndex{1}\)

A publisher of college textbooks claims that the average price of all hardbound college textbooks is \(\$127.50\). A student group believes that the actual mean is higher and wishes to test their belief. State the relevant null and alternative hypotheses.

The default option is to accept the publisher’s claim unless there is compelling evidence to the contrary. Thus the null hypothesis is \(H_0:\mu =127.50\). Since the student group thinks that the average textbook price is greater than the publisher’s figure, the alternative hypothesis in this situation is \(H_a:\mu >127.50\).

Example \(\PageIndex{2}\)

The recipe for a bakery item is designed to result in a product that contains \(8\) grams of fat per serving. The quality control department samples the product periodically to insure that the production process is working as designed. State the relevant null and alternative hypotheses.

The default option is to assume that the product contains the amount of fat it was formulated to contain unless there is compelling evidence to the contrary. Thus the null hypothesis is \(H_0:\mu =8.0\). Since to contain either more fat than desired or to contain less fat than desired are both an indication of a faulty production process, the alternative hypothesis in this situation is that the mean is different from \(8.0\), so \(H_a:\mu \neq 8.0\).

In Example \(\PageIndex{1}\), the textbook example, it might seem more natural that the publisher’s claim be that the average price is at most \(\$127.50\), not exactly \(\$127.50\). If the claim were made this way, then the null hypothesis would be \(H_0:\mu \leq 127.50\), and the value \(\$127.50\) given in the example would be the one that is least favorable to the publisher’s claim, the null hypothesis. It is always true that if the null hypothesis is retained for its least favorable value, then it is retained for every other value.

Thus in order to make the null and alternative hypotheses easy for the student to distinguish, in every example and problem in this text we will always present one of the two competing claims about the value of a parameter with an equality. The claim expressed with an equality is the null hypothesis. This is the same as always stating the null hypothesis in the least favorable light. So in the introductory example about the respirators, we stated the manufacturer’s claim as “the average is \(75\) minutes” instead of the perhaps more natural “the average is at least \(75\) minutes,” essentially reducing the presentation of the null hypothesis to its worst case.

The first step in hypothesis testing is to identify the null and alternative hypotheses.

The Logic of Hypothesis Testing

Although we will study hypothesis testing in situations other than for a single population mean (for example, for a population proportion instead of a mean or in comparing the means of two different populations), in this section the discussion will always be given in terms of a single population mean \(\mu\).

The null hypothesis always has the form \(H_0:\mu =\mu _0\) for a specific number \(\mu _0\) (in the respirator example \(\mu _0=75\), in the textbook example \(\mu _0=127.50\), and in the baked goods example \(\mu _0=8.0\)). Since the null hypothesis is accepted unless there is strong evidence to the contrary, the test procedure is based on the initial assumption that \(H_0\) is true. This point is so important that we will repeat it in a display:

The test procedure is based on the initial assumption that \(H_0\) is true.

The criterion for judging between \(H_0\) and \(H_a\) based on the sample data is: if the value of \(\overline{X}\) would be highly unlikely to occur if \(H_0\) were true, but favors the truth of \(H_a\), then we reject \(H_0\) in favor of \(H_a\). Otherwise we do not reject \(H_0\).

Supposing for now that \(\overline{X}\) follows a normal distribution, when the null hypothesis is true the density function for the sample mean \(\overline{X}\) must be as in Figure \(\PageIndex{1}\): a bell curve centered at \(\mu _0\). Thus if \(H_0\) is true then \(\overline{X}\) is likely to take a value near \(\mu _0\) and is unlikely to take values far away. Our decision procedure therefore reduces simply to:

• if \(H_a\) has the form \(H_a:\mu <\mu _0\) then reject \(H_0\) if \(\bar{x}\) is far to the left of \(\mu _0\);
• if \(H_a\) has the form \(H_a:\mu >\mu _0\) then reject \(H_0\) if \(\bar{x}\) is far to the right of \(\mu _0\);
• if \(H_a\) has the form \(H_a:\mu \neq \mu _0\) then reject \(H_0\) if \(\bar{x}\) is far away from \(\mu _0\) in either direction.

Think of the respirator example, for which the null hypothesis is \(H_0:\mu =75\), the claim that the average time air is delivered for all respirators is \(75\) minutes. If the sample mean is \(75\) or greater then we certainly would not reject \(H_0\) (since there is no issue with an emergency respirator delivering air even longer than claimed).

If the sample mean is slightly less than \(75\) then we would logically attribute the difference to sampling error and also not reject \(H_0\) either.

Values of the sample mean that are smaller and smaller are less and less likely to come from a population for which the population mean is \(75\). Thus if the sample mean is far less than \(75\), say around \(60\) minutes or less, then we would certainly reject \(H_0\), because we know that it is highly unlikely that the average of a sample would be so low if the population mean were \(75\). This is the rare event criterion for rejection: what we actually observed \((\overline{X}<60)\) would be so rare an event if \(\mu =75\) were true that we regard it as much more likely that the alternative hypothesis \(\mu <75\) holds.

In summary, to decide between \(H_0\) and \(H_a\) in this example we would select a “rejection region” of values sufficiently far to the left of \(75\), based on the rare event criterion, and reject \(H_0\) if the sample mean \(\overline{X}\) lies in the rejection region, but not reject \(H_0\) if it does not.

The Rejection Region

Each different form of the alternative hypothesis Ha has its own kind of rejection region:

• if (as in the respirator example) \(H_a\) has the form \(H_a:\mu <\mu _0\), we reject \(H_0\) if \(\bar{x}\) is far to the left of \(\mu _0\), that is, to the left of some number \(C\), so the rejection region has the form of an interval \((-\infty ,C]\);
• if (as in the textbook example) \(H_a\) has the form \(H_a:\mu >\mu _0\), we reject \(H_0\) if \(\bar{x}\) is far to the right of \(\mu _0\), that is, to the right of some number \(C\), so the rejection region has the form of an interval \([C,\infty )\);
• if (as in the baked good example) \(H_a\) has the form \(H_a:\mu \neq \mu _0\), we reject \(H_0\) if \(\bar{x}\) is far away from \(\mu _0\) in either direction, that is, either to the left of some number \(C\) or to the right of some other number \(C′\), so the rejection region has the form of the union of two intervals \((-\infty ,C]\cup [C',\infty )\).

The key issue in our line of reasoning is the question of how to determine the number \(C\) or numbers \(C\) and \(C′\), called the critical value or critical values of the statistic, that determine the rejection region.

Definition: critical values

The critical value or critical values of a test of hypotheses are the number or numbers that determine the rejection region.

Suppose the rejection region is a single interval, so we need to select a single number \(C\). Here is the procedure for doing so. We select a small probability, denoted \(\alpha\), say \(1\%\), which we take as our definition of “rare event:” an event is “rare” if its probability of occurrence is less than \(\alpha\). (In all the examples and problems in this text the value of \(\alpha\) will be given already.) The probability that \(\overline{X}\) takes a value in an interval is the area under its density curve and above that interval, so as shown in Figure \(\PageIndex{2}\) (drawn under the assumption that \(H_0\) is true, so that the curve centers at \(\mu _0\)) the critical value \(C\) is the value of \(\overline{X}\) that cuts off a tail area \(\alpha\) in the probability density curve of \(\overline{X}\). When the rejection region is in two pieces, that is, composed of two intervals, the total area above both of them must be \(\alpha\), so the area above each one is \(\alpha /2\), as also shown in Figure \(\PageIndex{2}\).

The number \(\alpha\) is the total area of a tail or a pair of tails.

Example \(\PageIndex{3}\)

In the context of Example \(\PageIndex{2}\), suppose that it is known that the population is normally distributed with standard deviation \(\alpha =0.15\) gram, and suppose that the test of hypotheses \(H_0:\mu =8.0\) versus \(H_a:\mu \neq 8.0\) will be performed with a sample of size \(5\). Construct the rejection region for the test for the choice \(\alpha =0.10\). Explain the decision procedure and interpret it.

If \(H_0\) is true then the sample mean \(\overline{X}\) is normally distributed with mean and standard deviation

\[\begin{align} \mu _{\overline{X}} &=\mu \nonumber \\[5pt] &=8.0 \nonumber \end{align} \nonumber \]

\[\begin{align} \sigma _{\overline{X}}&=\dfrac{\sigma}{\sqrt{n}} \nonumber \\[5pt] &= \dfrac{0.15}{\sqrt{5}} \nonumber\\[5pt] &=0.067 \nonumber \end{align} \nonumber \]

Since \(H_a\) contains the \(\neq\) symbol the rejection region will be in two pieces, each one corresponding to a tail of area \(\alpha /2=0.10/2=0.05\). From Figure 7.1.6, \(z_{0.05}=1.645\), so \(C\) and \(C′\) are \(1.645\) standard deviations of \(\overline{X}\) to the right and left of its mean \(8.0\):

\[C=8.0-(1.645)(0.067) = 7.89 \; \; \text{and}\; \; C'=8.0 + (1.645)(0.067) = 8.11 \nonumber \]

The result is shown in Figure \(\PageIndex{3}\). α = 0.1

The decision procedure is: take a sample of size \(5\) and compute the sample mean \(\bar{x}\). If \(\bar{x}\) is either \(7.89\) grams or less or \(8.11\) grams or more then reject the hypothesis that the average amount of fat in all servings of the product is \(8.0\) grams in favor of the alternative that it is different from \(8.0\) grams. Otherwise do not reject the hypothesis that the average amount is \(8.0\) grams.

The reasoning is that if the true average amount of fat per serving were \(8.0\) grams then there would be less than a \(10\%\) chance that a sample of size \(5\) would produce a mean of either \(7.89\) grams or less or \(8.11\) grams or more. Hence if that happened it would be more likely that the value \(8.0\) is incorrect (always assuming that the population standard deviation is \(0.15\) gram).

Because the rejection regions are computed based on areas in tails of distributions, as shown in Figure \(\PageIndex{2}\), hypothesis tests are classified according to the form of the alternative hypothesis in the following way.

Definitions: Test classifications

• If \(H_a\) has the form \(\mu \neq \mu _0\) the test is called a two-tailed test .
• If \(H_a\) has the form \(\mu < \mu _0\) the test is called a left-tailed test .
• If \(H_a\) has the form \(\mu > \mu _0\)the test is called a right-tailed test .

Each of the last two forms is also called a one-tailed test .

Two Types of Errors

The format of the testing procedure in general terms is to take a sample and use the information it contains to come to a decision about the two hypotheses. As stated before our decision will always be either

• reject the null hypothesis \(H_0\) in favor of the alternative \(H_a\) presented, or
• do not reject the null hypothesis \(H_0\) in favor of the alternative \(H_0\) presented.

There are four possible outcomes of hypothesis testing procedure, as shown in the following table:

As the table shows, there are two ways to be right and two ways to be wrong. Typically to reject \(H_0\) when it is actually true is a more serious error than to fail to reject it when it is false, so the former error is labeled “ Type I ” and the latter error “ Type II ”.

Definition: Type I and Type II errors

In a test of hypotheses:

• A Type I error is the decision to reject \(H_0\) when it is in fact true.
• A Type II error is the decision not to reject \(H_0\) when it is in fact not true.

Unless we perform a census we do not have certain knowledge, so we do not know whether our decision matches the true state of nature or if we have made an error. We reject \(H_0\) if what we observe would be a “rare” event if \(H_0\) were true. But rare events are not impossible: they occur with probability \(\alpha\). Thus when \(H_0\) is true, a rare event will be observed in the proportion \(\alpha\) of repeated similar tests, and \(H_0\) will be erroneously rejected in those tests. Thus \(\alpha\) is the probability that in following the testing procedure to decide between \(H_0\) and \(H_a\) we will make a Type I error.

Definition: level of significance

The number \(\alpha\) that is used to determine the rejection region is called the level of significance of the test. It is the probability that the test procedure will result in a Type I error .

The probability of making a Type II error is too complicated to discuss in a beginning text, so we will say no more about it than this: for a fixed sample size, choosing \(alpha\) smaller in order to reduce the chance of making a Type I error has the effect of increasing the chance of making a Type II error . The only way to simultaneously reduce the chances of making either kind of error is to increase the sample size.

Standardizing the Test Statistic

Hypotheses testing will be considered in a number of contexts, and great unification as well as simplification results when the relevant sample statistic is standardized by subtracting its mean from it and then dividing by its standard deviation. The resulting statistic is called a standardized test statistic . In every situation treated in this and the following two chapters the standardized test statistic will have either the standard normal distribution or Student’s \(t\)-distribution.

Definition: hypothesis test

A standardized test statistic for a hypothesis test is the statistic that is formed by subtracting from the statistic of interest its mean and dividing by its standard deviation.

For example, reviewing Example \(\PageIndex{3}\), if instead of working with the sample mean \(\overline{X}\) we instead work with the test statistic

\[\frac{\overline{X}-8.0}{0.067} \nonumber \]

then the distribution involved is standard normal and the critical values are just \(\pm z_{0.05}\). The extra work that was done to find that \(C=7.89\) and \(C′=8.11\) is eliminated. In every hypothesis test in this book the standardized test statistic will be governed by either the standard normal distribution or Student’s \(t\)-distribution. Information about rejection regions is summarized in the following tables:

Every instance of hypothesis testing discussed in this and the following two chapters will have a rejection region like one of the six forms tabulated in the tables above.

No matter what the context a test of hypotheses can always be performed by applying the following systematic procedure, which will be illustrated in the examples in the succeeding sections.

Systematic Hypothesis Testing Procedure: Critical Value Approach

• Identify the null and alternative hypotheses.
• Identify the relevant test statistic and its distribution.
• Compute from the data the value of the test statistic.
• Construct the rejection region.
• Compare the value computed in Step 3 to the rejection region constructed in Step 4 and make a decision. Formulate the decision in the context of the problem, if applicable.

The procedure that we have outlined in this section is called the “Critical Value Approach” to hypothesis testing to distinguish it from an alternative but equivalent approach that will be introduced at the end of Section 8.3.

Key Takeaway

• A test of hypotheses is a statistical process for deciding between two competing assertions about a population parameter.
• The testing procedure is formalized in a five-step procedure.

• Math Article

Null Hypothesis

In mathematics, Statistics deals with the study of research and surveys on the numerical data. For taking surveys, we have to define the hypothesis. Generally, there are two types of hypothesis. One is a null hypothesis, and another is an alternative hypothesis .

In probability and statistics, the null hypothesis is a comprehensive statement or default status that there is zero happening or nothing happening. For example, there is no connection among groups or no association between two measured events. It is generally assumed here that the hypothesis is true until any other proof has been brought into the light to deny the hypothesis. Let us learn more here with definition, symbol, principle, types and example, in this article.

Table of contents:

• Comparison with Alternative Hypothesis

Null Hypothesis Definition

The null hypothesis is a kind of hypothesis which explains the population parameter whose purpose is to test the validity of the given experimental data. This hypothesis is either rejected or not rejected based on the viability of the given population or sample . In other words, the null hypothesis is a hypothesis in which the sample observations results from the chance. It is said to be a statement in which the surveyors wants to examine the data. It is denoted by H 0 .

Null Hypothesis Symbol

In statistics, the null hypothesis is usually denoted by letter H with subscript ‘0’ (zero), such that H 0 . It is pronounced as H-null or H-zero or H-nought. At the same time, the alternative hypothesis expresses the observations determined by the non-random cause. It is represented by H 1 or H a .

Null Hypothesis Principle

The principle followed for null hypothesis testing is, collecting the data and determining the chances of a given set of data during the study on some random sample, assuming that the null hypothesis is true. In case if the given data does not face the expected null hypothesis, then the outcome will be quite weaker, and they conclude by saying that the given set of data does not provide strong evidence against the null hypothesis because of insufficient evidence. Finally, the researchers tend to reject that.

Null Hypothesis Formula

Here, the hypothesis test formulas are given below for reference.

The formula for the null hypothesis is:

H 0 :  p = p 0

The formula for the alternative hypothesis is:

H a = p >p 0 , < p 0 ≠ p 0

The formula for the test static is:

Remember that,  p 0  is the null hypothesis and p – hat is the sample proportion.

Also, read:

Types of Null Hypothesis

There are different types of hypothesis. They are:

Simple Hypothesis

It completely specifies the population distribution. In this method, the sampling distribution is the function of the sample size.

Composite Hypothesis

The composite hypothesis is one that does not completely specify the population distribution.

Exact Hypothesis

Exact hypothesis defines the exact value of the parameter. For example μ= 50

Inexact Hypothesis

This type of hypothesis does not define the exact value of the parameter. But it denotes a specific range or interval. For example 45< μ <60

Null Hypothesis Rejection

Sometimes the null hypothesis is rejected too. If this hypothesis is rejected means, that research could be invalid. Many researchers will neglect this hypothesis as it is merely opposite to the alternate hypothesis. It is a better practice to create a hypothesis and test it. The goal of researchers is not to reject the hypothesis. But it is evident that a perfect statistical model is always associated with the failure to reject the null hypothesis.

How do you Find the Null Hypothesis?

The null hypothesis says there is no correlation between the measured event (the dependent variable) and the independent variable. We don’t have to believe that the null hypothesis is true to test it. On the contrast, you will possibly assume that there is a connection between a set of variables ( dependent and independent).

When is Null Hypothesis Rejected?

The null hypothesis is rejected using the P-value approach. If the P-value is less than or equal to the α, there should be a rejection of the null hypothesis in favour of the alternate hypothesis. In case, if P-value is greater than α, the null hypothesis is not rejected.

Null Hypothesis and Alternative Hypothesis

Now, let us discuss the difference between the null hypothesis and the alternative hypothesis.

Null Hypothesis Examples

Here, some of the examples of the null hypothesis are given below. Go through the below ones to understand the concept of the null hypothesis in a better way.

If a medicine reduces the risk of cardiac stroke, then the null hypothesis should be “the medicine does not reduce the chance of cardiac stroke”. This testing can be performed by the administration of a drug to a certain group of people in a controlled way. If the survey shows that there is a significant change in the people, then the hypothesis is rejected.

Few more examples are:

1). Are there is 100% chance of getting affected by dengue?

Ans: There could be chances of getting affected by dengue but not 100%.

2). Do teenagers are using mobile phones more than grown-ups to access the internet?

Ans: Age has no limit on using mobile phones to access the internet.

3). Does having apple daily will not cause fever?

Ans: Having apple daily does not assure of not having fever, but increases the immunity to fight against such diseases.

4). Do the children more good in doing mathematical calculations than grown-ups?

Ans: Age has no effect on Mathematical skills.

In many common applications, the choice of the null hypothesis is not automated, but the testing and calculations may be automated. Also, the choice of the null hypothesis is completely based on previous experiences and inconsistent advice. The choice can be more complicated and based on the variety of applications and the diversity of the objectives. 

The main limitation for the choice of the null hypothesis is that the hypothesis suggested by the data is based on the reasoning which proves nothing. It means that if some hypothesis provides a summary of the data set, then there would be no value in the testing of the hypothesis on the particular set of data. 

Frequently Asked Questions on Null Hypothesis

What is meant by the null hypothesis.

In Statistics, a null hypothesis is a type of hypothesis which explains the population parameter whose purpose is to test the validity of the given experimental data.

What are the benefits of hypothesis testing?

Hypothesis testing is defined as a form of inferential statistics, which allows making conclusions from the entire population based on the sample representative.

When a null hypothesis is accepted and rejected?

The null hypothesis is either accepted or rejected in terms of the given data. If P-value is less than α, then the null hypothesis is rejected in favor of the alternative hypothesis, and if the P-value is greater than α, then the null hypothesis is accepted in favor of the alternative hypothesis.

Why is the null hypothesis important?

The importance of the null hypothesis is that it provides an approximate description of the phenomena of the given data. It allows the investigators to directly test the relational statement in a research study.

How to accept or reject the null hypothesis in the chi-square test?

If the result of the chi-square test is bigger than the critical value in the table, then the data does not fit the model, which represents the rejection of the null hypothesis.

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AP®︎/College Statistics

Course: ap®︎/college statistics   >   unit 10.

• Idea behind hypothesis testing

Examples of null and alternative hypotheses

• Writing null and alternative hypotheses
• P-values and significance tests
• Comparing P-values to different significance levels
• Estimating a P-value from a simulation
• Estimating P-values from simulations
• Using P-values to make conclusions

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Video transcript

Module 9: Hypothesis Testing With One Sample

Null and alternative hypotheses, learning outcomes.

• Describe hypothesis testing in general and in practice

The actual test begins by considering two  hypotheses . They are called the null hypothesis and the alternative hypothesis . These hypotheses contain opposing viewpoints.

H 0 : The null hypothesis: It is a statement about the population that either is believed to be true or is used to put forth an argument unless it can be shown to be incorrect beyond a reasonable doubt.

H a : The alternative hypothesis : It is a claim about the population that is contradictory to H 0 and what we conclude when we reject H 0 .

Since the null and alternative hypotheses are contradictory, you must examine evidence to decide if you have enough evidence to reject the null hypothesis or not. The evidence is in the form of sample data.

After you have determined which hypothesis the sample supports, you make adecision. There are two options for a  decision . They are “reject H 0 ” if the sample information favors the alternative hypothesis or “do not reject H 0 ” or “decline to reject H 0 ” if the sample information is insufficient to reject the null hypothesis.

Mathematical Symbols Used in  H 0 and H a :

H 0 always has a symbol with an equal in it. H a never has a symbol with an equal in it. The choice of symbol depends on the wording of the hypothesis test. However, be aware that many researchers (including one of the co-authors in research work) use = in the null hypothesis, even with > or < as the symbol in the alternative hypothesis. This practice is acceptable because we only make the decision to reject or not reject the null hypothesis.

H 0 : No more than 30% of the registered voters in Santa Clara County voted in the primary election. p ≤ 30

H a : More than 30% of the registered voters in Santa Clara County voted in the primary election. p > 30

A medical trial is conducted to test whether or not a new medicine reduces cholesterol by 25%. State the null and alternative hypotheses.

H 0 : The drug reduces cholesterol by 25%. p = 0.25

H a : The drug does not reduce cholesterol by 25%. p ≠ 0.25

We want to test whether the mean GPA of students in American colleges is different from 2.0 (out of 4.0). The null and alternative hypotheses are:

H 0 : μ = 2.0

H a : μ ≠ 2.0

We want to test whether the mean height of eighth graders is 66 inches. State the null and alternative hypotheses. Fill in the correct symbol (=, ≠, ≥, <, ≤, >) for the null and alternative hypotheses. H 0 : μ __ 66 H a : μ __ 66

• H 0 : μ = 66
• H a : μ ≠ 66

We want to test if college students take less than five years to graduate from college, on the average. The null and alternative hypotheses are:

H 0 : μ ≥ 5

H a : μ < 5

We want to test if it takes fewer than 45 minutes to teach a lesson plan. State the null and alternative hypotheses. Fill in the correct symbol ( =, ≠, ≥, <, ≤, >) for the null and alternative hypotheses. H 0 : μ __ 45 H a : μ __ 45

• H 0 : μ ≥ 45
• H a : μ < 45

In an issue of U.S. News and World Report , an article on school standards stated that about half of all students in France, Germany, and Israel take advanced placement exams and a third pass. The same article stated that 6.6% of U.S. students take advanced placement exams and 4.4% pass. Test if the percentage of U.S. students who take advanced placement exams is more than 6.6%. State the null and alternative hypotheses.

H 0 : p ≤ 0.066

H a : p > 0.066

On a state driver’s test, about 40% pass the test on the first try. We want to test if more than 40% pass on the first try. Fill in the correct symbol (=, ≠, ≥, <, ≤, >) for the null and alternative hypotheses. H 0 : p __ 0.40 H a : p __ 0.40

• H 0 : p = 0.40
• H a : p > 0.40

Concept Review

In a  hypothesis test , sample data is evaluated in order to arrive at a decision about some type of claim. If certain conditions about the sample are satisfied, then the claim can be evaluated for a population. In a hypothesis test, we: Evaluate the null hypothesis , typically denoted with H 0 . The null is not rejected unless the hypothesis test shows otherwise. The null statement must always contain some form of equality (=, ≤ or ≥) Always write the alternative hypothesis , typically denoted with H a or H 1 , using less than, greater than, or not equals symbols, i.e., (≠, >, or <). If we reject the null hypothesis, then we can assume there is enough evidence to support the alternative hypothesis. Never state that a claim is proven true or false. Keep in mind the underlying fact that hypothesis testing is based on probability laws; therefore, we can talk only in terms of non-absolute certainties.

Formula Review

H 0 and H a are contradictory.

• OpenStax, Statistics, Null and Alternative Hypotheses. Provided by : OpenStax. Located at : http://cnx.org/contents/[email protected]:58/Introductory_Statistics . License : CC BY: Attribution
• Introductory Statistics . Authored by : Barbara Illowski, Susan Dean. Provided by : Open Stax. Located at : http://cnx.org/contents/[email protected] . License : CC BY: Attribution . License Terms : Download for free at http://cnx.org/contents/[email protected]
• Simple hypothesis testing | Probability and Statistics | Khan Academy. Authored by : Khan Academy. Located at : https://youtu.be/5D1gV37bKXY . License : All Rights Reserved . License Terms : Standard YouTube License

What Is a Null Hypothesis?

A null hypothesis may be a sort of hypothesis utilized in statistics that proposes that there’s no difference between certain characteristics of a population (or data-generating process). For example, a gambler could also be curious about whether a game of chance is fair. If it’s fair, then the expected earnings per play is 0 for […]

A null hypothesis may be a sort of hypothesis utilized in statistics that proposes that there’s no difference between certain characteristics of a population (or data-generating process).

For example, a gambler could also be curious about whether a game of chance is fair. If it’s fair, then the expected earnings per play is 0 for both players. If the sport isn’t fair, then the expected earnings are positive for one player and negative for the opposite. to check whether the sport is fair, the gambler collects earnings data from many repetitions of the sport , calculates the typical earnings from these data, then tests the null hypothesis that the expected earnings isn’t different from zero.

If the typical earnings from the sample data is sufficiently faraway from zero, then the gambler will reject the null hypothesis and conclude the choice hypothesis; namely, that the expected earnings per play is different from zero. If the typical earnings from the sample data are on the brink of zero, then the gambler won’t reject the null hypothesis, concluding instead that the difference between the typical from the info and 0 is explainable accidentally alone.

KEY TAKEAWAYS

A null hypothesis may be a sort of conjecture utilized in statistics that proposes that there’s no difference between certain characteristics of a population or data-generating process.

The alternative hypothesis proposes that there’s a difference.

Hypothesis testing provides a way to reject a null hypothesis within a particular confidence level. (Null hypotheses can’t be proven, though.)

How a Null Hypothesis Works

The null hypothesis, also referred to as the conjecture, assumes that any quite difference between the chosen characteristics that you simply see during a set of knowledge is thanks to chance. For instance, if the expected earnings for the game of chance are actually adequate to 0, then any difference between the typical earnings within the data and 0 is thanks to chance.

Statistical hypotheses are tested employing a four-step process. The primary step is for the analyst to state the 2 hypotheses in order that just one is often right. Subsequent step is to formulate an analysis plan, which outlines how the info is going to be evaluated. The third step is to hold out the plan and physically analyze the sample data. The fourth and final step is to research the results and either reject the null hypothesis, or claim that the observed differences are explainable accidentally alone.

Analysts look to reject the null hypothesis because it’s a robust conclusion. The choice conclusion, that the results are “explainable accidentally alone,” could also be a weak conclusion because it allows that factors aside from chance may be at work.

Analysts look to reject the null hypothesis to rule out some variable(s) as explaining the phenomena of interest.

Null Hypothesis Example

Here may be a simple example: a faculty principal reports that students in her school score a mean of seven out of 10 in exams. The null hypothesis is that the population mean is 7.0. To check this null hypothesis, we record marks of say 30 students (sample) from the whole student population of the varsity (say 300) and calculate the mean of that sample. We will then compare the (calculated) sample mean to the (claimed) population mean of seven .0 and plan to reject the null hypothesis. (The null hypothesis that the population mean is 7.0 can’t be proven using the sample data; it can only be rejected.)

Take another example: The annual return of a specific open-end fund is claimed to be 8%. Assume that open-end fund has been alive for 20 years. The null hypothesis is that the mean return is 8% for the open-end fund. We take a random sample of annual returns of the open-end fund for, say, five years (sample) and calculate the sample mean. We then compare the (calculated) sample mean to the (claimed) population mean (8%) to test the null hypothesis.

For the above examples, null hypotheses are:

Example A: Students within the school score a mean of seven out of 10 in exams.

Example B: Mean annual return of the open-end fund is 8% once a year.

For the needs of determining whether to reject the null hypothesis, the null hypothesis (abbreviated H0) is assumed, for the sake of argument, to be true. Then the likely range of possible values of the calculated statistic (e.g., average score on 30 students’ tests) is decided under this presumption (e.g., the range of plausible averages may range from 6.2 to 7.8 if the population mean is 7.0). Then, if the sample average is outside of this range, the null hypothesis is rejected. Otherwise, the difference is claimed to be “explainable accidentally alone,” being within the range that’s determined accidentally alone.

An important point to notice is that we are testing the null hypothesis because there’s a component of doubt about its validity. Whatever information that’s against the stated null hypothesis is captured within the Alternative Hypothesis (H1). For the above examples, the choice hypothesis would be:

Students score a mean that’s not adequate to 7.

The mean annual return of the open-end fund isn’t adequate to 8% once a year.

In other words, the choice hypothesis may be a direct contradiction of the null hypothesis.

Hypothesis Testing for Investments

As an example associated with financial markets, assume Alice sees that her investment strategy produces higher average returns than simply buying and holding a stock. The null hypothesis states that there’s no difference between the 2 average returns, and Alice is inclined to believe this until she proves otherwise. Refuting the null hypothesis would require showing statistical significance, which may be found employing a sort of tests. The choice hypothesis would state that the investment strategy features a higher average return than a standard buy-and-hold strategy.

The p-value is employed to work out the statistical significance of the results. A p-value that’s but or adequate to 0.05 is usually wont to indicate whether there’s evidence against the null hypothesis. If Alice conducts one among these tests, like a test using the traditional model, and proves that the difference between her returns and therefore the buy-and-hold returns is critical (p-value is a smaller amount than or adequate to 0.05), she will then refute the null hypothesis and conclude the choice hypothesis.

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Exploring the Null Hypothesis: Definition and Purpose

Updated: July 5, 2023 by Ken Feldman

Hypothesis testing is a branch of statistics in which, using data from a sample, an inference is made about a population parameter or a population probability distribution .

First, a hypothesis statement and assumption is made about the population parameter or probability distribution. This initial statement is called the Null Hypothesis and is denoted by H o. An alternative or alternate hypothesis (denoted Ha ), is then stated which will be the opposite of the Null Hypothesis.

The hypothesis testing process and analysis involves using sample data to determine whether or not you can be statistically confident that you can reject or fail to reject the H o. If the H o is rejected, the statistical conclusion is that the alternative or alternate hypothesis Ha is true.

Overview: What is the Null Hypothesis (Ho)? 

Hypothesis testing applies to all forms of statistical inquiry. For example, it can be used to determine whether there are differences between population parameters or an understanding about slopes of regression lines or equality of probability distributions.

In all cases, the first thing you do is state the Null and Alternate Hypotheses. The word Null in the context of hypothesis testing means “nothing” or “zero.”  

As an example, if we wanted to test whether there was a difference in two population means based on the calculations from two samples, we would state the Null Hypothesis in the form of: 

Ho: mu1 = mu2 or mu1- mu2 = 0  

In other words, there is no difference, or the difference is zero. Note that the notation is in the form of a population parameter, not a sample statistic. 

Since you are using sample data to make your inferences about the population, it’s possible you’ll make an error. In the case of the Null Hypothesis, we can make one of two errors.

•   Type 1 , or alpha error: An alpha error is when you mistakenly reject the Null and believe that something significant happened. In other words, you believe that the means of the two populations are different when they aren’t.
• Type 2, or beta error: A beta error is when you fail to reject the null when you should have.  In this case, you missed something significant and failed to take action. 

A classic example is when you get the results back from your doctor after taking a blood test. If the doctor says you have an infection when you really don’t, that is an alpha error. That is thinking that there is something significant going on when there isn’t. We also call that a false positive. The doctor rejected the null that “there was zero infection” and missed the call.

On the other hand, if the doctor told you that everything was OK when you really did have an infection, then he made a beta, or type 2, error. He failed to reject the Null Hypothesis when he should have. That is called a false negative.

The decision to reject or not to reject the Null Hypothesis is based on three numbers. 

• Alpha, which you get to choose. Alpha is the risk you are willing to assume of falsely rejecting the Null. The typical values for alpha are 1%, 5%, or 10%. Depending on the importance of the conclusion, you only want to falsely claim a difference when there is none, 1%, 5%, or 10% of the time.
• Beta, which is typically 20%. This means you’re willing to be wrong 20% of the time in failing to reject the null when you should have. 
• P-value, which is calculated from the data. The p-value is the actual risk you have in being wrong if you reject the null. You would like that to be low.  

Your decision as to what to do about the null is made by comparing the alpha value (your assumed risk) with the p-value (actual risk). If the actual risk is lower than your assumed risk, you can feel comfortable in rejecting the null and claiming something has happened. But, if the actual risk is higher than your assumed risk you will be taking a bigger risk than you want by rejecting the null.

RELATED: NULL VS. ALTERNATIVE HYPOTHESIS

3 benefits of the null hypothesis .

The stating and testing of the null hypothesis is the foundation of hypothesis testing. By doing so, you set the parameters for your statistical inference.

1. Statistical assurance of determining differences between population parameters

Just looking at the mathematical difference between the means of two samples and making a decision is woefully inadequate. By statistically testing the null hypothesis, you will have more confidence in any inferences you want to make about populations based on your samples.

2. Statistically based estimation of the probability of a population distribution

Many statistical tests require assumptions of specific distributions. Many of these tests assume that the population follows the normal distribution . If it doesn’t, the test may be invalid.  

3. Assess the strength of your conclusions as to what to do with the null hypothesis

Hypothesis testing calculations will provide some relative strength to your decisions as to whether you reject or fail to reject the null hypothesis.

Why is the Null Hypothesis important to understand?

The interpretation of the statistics relative to the null hypothesis is what’s important.

1. Properly write the null hypothesis to properly capture what you are seeking to prove

The null is always written in the same format. That is, the lack of difference or some other condition. The alternative hypothesis can be written in three formats depending on what you want to prove. 

2. Frame your statement and select an appropriate alpha risk

You don’t want to place too big of a hurdle or burden on your decision-making relative to action on the null hypothesis by selecting an alpha value that is too high or too low.

3. There are decision errors when deciding on how to respond to the Null Hypothesis

Since your decision relative to rejecting or not rejecting the null is based on statistical calculations, it is important to understand how that decision works. 

An industry example of using the Null Hypothesis 

The new director of marketing just completed the rollout of a new marketing campaign targeting the Hispanic market. Early indications showed that the campaign was successful in increasing sales in the Hispanic market. 

He came to that conclusion by comparing a sample of sales prior to the campaign and current sales after implementation of the campaign. He was anxious to proudly tell his boss how successful the campaign was. But, he decided to first check with his Lean Six Sigma Black Belt to see whether she agreed with his conclusion.

The Black Belt first asked the director his tolerance for risk of being wrong by telling the boss the campaign was successful when in fact, it wasn’t. That was the alpha value. The Director picked 5% since he was new and didn’t want to make a false claim so early in his career. He also picked 20% as his beta value.  

When the Black Belt was done analyzing the data, she found out that the p-value was 15%.  That meant if the director told the VP the campaign worked, there was a 15% chance he would be wrong and that the campaign probably needed some revising. Since he was only willing to be wrong 5% of the time, the decision was to not reject the null since his 5% assumed risk was less than the 15% actual risk.

3 best practices when thinking about the Null Hypothesis 

Using hypothesis testing to help make better data-driven decisions requires that you properly address the Null Hypothesis. 

1. Always use the proper nomenclature when stating the Null Hypothesis 

The null will always be in the form of decisions regarding the population, not the sample. 

2. The Null Hypothesis will always be written as the absence of some parameter or process characteristic

The writing of the Alternate Hypothesis can vary, so be sure you understand exactly what condition you are testing against. 

3. Pick a reasonable alpha risk so you’re not always failing to reject the Null Hypothesis

Being too cautious will lead you to make beta errors, and you’ll never learn anything about your population data. 

Frequently Asked Questions (FAQ) about the Null Hypothesis

What form should the null hypothesis be written in.

The Null Hypothesis should always be in the form of no difference or zero and always refer to the state of the population, not the sample. 

What is an alpha error? 

An alpha error, or Type 1 error, is rejecting the Null Hypothesis and claiming a significant event has occurred when, in fact, that is not true and the Null should not have been rejected.

How do I use the alpha error and p-value to decide on what decision I should make about the Null Hypothesis? 

The most common way of answering this is, “If the p-value is low (less than the alpha), the Null should be rejected. If the p-value is high (greater than the alpha) then the Null should not be rejected.”

Becoming familiar with the Null Hypothesis (Ho)

The proper writing of the Null Hypothesis is the basis for applying hypothesis testing to help you make better data-driven decisions. The format of the Null will always be in the form of zero, or the non-existence of some condition. It will always refer to a population parameter and not the sample you use to do your hypothesis testing calculations.

Be aware of the two types of errors you can make when deciding on what to do with the Null. Select reasonable risks values for your alpha and beta risks. By comparing your alpha risk with the calculated risk computed from the data, you will have sufficient information to make a wise decision as to whether you should reject the Null Hypothesis or not.

About the Author

Ken Feldman

• Encyclopedia ›
• Null hypothesis

Definition Null hypothesis

A null hypothesis is what we call an assumption, the statement of which can be statistically verified. Often, a null hypothesis cannot be verified and can only be falsified. This means, that a null hypothesis is true until its falseness can be demonstrated.

An example of a historical statistical null hypothesis was published by Malthus in his theory of population  from the 1798 book Essay on the Principle of Population . In his essay, Malthus established the hypothesis  that  food production would not be able to keep up with the earth's population growth . His reasoning was based on the contrast between agricultural performance and the abrupt population growth at the time. Based on the (empirical) experience of countless famines  in Europe during the 19th century, Malthus' hypothesis was regarded as correct. Over the course of the 20th century, however, the null hypothesis was refuted.

Please note that the definitions in our statistics encyclopedia are simplified explanations of terms. Our goal is to make the definitions accessible for a broad audience; thus it is possible that some definitions do not adhere entirely to scientific standards.

• Normal distribution
• Nominal scale

9.1 Null and Alternative Hypotheses

The actual test begins by considering two hypotheses . They are called the null hypothesis and the alternative hypothesis . These hypotheses contain opposing viewpoints.

H 0 : The null hypothesis: It is a statement of no difference between the variables—they are not related. This can often be considered the status quo and as a result if you cannot accept the null it requires some action.

H a : The alternative hypothesis: It is a claim about the population that is contradictory to H 0 and what we conclude when we reject H 0 . This is usually what the researcher is trying to prove.

Since the null and alternative hypotheses are contradictory, you must examine evidence to decide if you have enough evidence to reject the null hypothesis or not. The evidence is in the form of sample data.

After you have determined which hypothesis the sample supports, you make a decision. There are two options for a decision. They are "reject H 0 " if the sample information favors the alternative hypothesis or "do not reject H 0 " or "decline to reject H 0 " if the sample information is insufficient to reject the null hypothesis.

Mathematical Symbols Used in H 0 and H a :

H 0 always has a symbol with an equal in it. H a never has a symbol with an equal in it. The choice of symbol depends on the wording of the hypothesis test. However, be aware that many researchers (including one of the co-authors in research work) use = in the null hypothesis, even with > or < as the symbol in the alternative hypothesis. This practice is acceptable because we only make the decision to reject or not reject the null hypothesis.

Example 9.1

H 0 : No more than 30% of the registered voters in Santa Clara County voted in the primary election. p ≤ .30 H a : More than 30% of the registered voters in Santa Clara County voted in the primary election. p > 30

A medical trial is conducted to test whether or not a new medicine reduces cholesterol by 25%. State the null and alternative hypotheses.

Example 9.2

We want to test whether the mean GPA of students in American colleges is different from 2.0 (out of 4.0). The null and alternative hypotheses are: H 0 : μ = 2.0 H a : μ ≠ 2.0

We want to test whether the mean height of eighth graders is 66 inches. State the null and alternative hypotheses. Fill in the correct symbol (=, ≠, ≥, <, ≤, >) for the null and alternative hypotheses.

• H 0 : μ __ 66
• H a : μ __ 66

Example 9.3

We want to test if college students take less than five years to graduate from college, on the average. The null and alternative hypotheses are: H 0 : μ ≥ 5 H a : μ < 5

We want to test if it takes fewer than 45 minutes to teach a lesson plan. State the null and alternative hypotheses. Fill in the correct symbol ( =, ≠, ≥, <, ≤, >) for the null and alternative hypotheses.

• H 0 : μ __ 45
• H a : μ __ 45

Example 9.4

In an issue of U. S. News and World Report , an article on school standards stated that about half of all students in France, Germany, and Israel take advanced placement exams and a third pass. The same article stated that 6.6% of U.S. students take advanced placement exams and 4.4% pass. Test if the percentage of U.S. students who take advanced placement exams is more than 6.6%. State the null and alternative hypotheses. H 0 : p ≤ 0.066 H a : p > 0.066

On a state driver’s test, about 40% pass the test on the first try. We want to test if more than 40% pass on the first try. Fill in the correct symbol (=, ≠, ≥, <, ≤, >) for the null and alternative hypotheses.

• H 0 : p __ 0.40
• H a : p __ 0.40

Collaborative Exercise

Bring to class a newspaper, some news magazines, and some Internet articles . In groups, find articles from which your group can write null and alternative hypotheses. Discuss your hypotheses with the rest of the class.

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What is The Null Hypothesis & When Do You Reject The Null Hypothesis

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On This Page:

A null hypothesis is a statistical concept suggesting no significant difference or relationship between measured variables. It’s the default assumption unless empirical evidence proves otherwise.

The null hypothesis states no relationship exists between the two variables being studied (i.e., one variable does not affect the other).

The null hypothesis is the statement that a researcher or an investigator wants to disprove.

Testing the null hypothesis can tell you whether your results are due to the effects of manipulating ​ the dependent variable or due to random chance. 

How to Write a Null Hypothesis

Null hypotheses (H0) start as research questions that the investigator rephrases as statements indicating no effect or relationship between the independent and dependent variables.

It is a default position that your research aims to challenge or confirm.

For example, if studying the impact of exercise on weight loss, your null hypothesis might be:

There is no significant difference in weight loss between individuals who exercise daily and those who do not.

Examples of Null Hypotheses

When do we reject the null hypothesis .

We reject the null hypothesis when the data provide strong enough evidence to conclude that it is likely incorrect. This often occurs when the p-value (probability of observing the data given the null hypothesis is true) is below a predetermined significance level.

If the collected data does not meet the expectation of the null hypothesis, a researcher can conclude that the data lacks sufficient evidence to back up the null hypothesis, and thus the null hypothesis is rejected. 

Rejecting the null hypothesis means that a relationship does exist between a set of variables and the effect is statistically significant ( p > 0.05).

If the data collected from the random sample is not statistically significance , then the null hypothesis will be accepted, and the researchers can conclude that there is no relationship between the variables. 

You need to perform a statistical test on your data in order to evaluate how consistent it is with the null hypothesis. A p-value is one statistical measurement used to validate a hypothesis against observed data.

Calculating the p-value is a critical part of null-hypothesis significance testing because it quantifies how strongly the sample data contradicts the null hypothesis.

The level of statistical significance is often expressed as a  p  -value between 0 and 1. The smaller the p-value, the stronger the evidence that you should reject the null hypothesis.

Usually, a researcher uses a confidence level of 95% or 99% (p-value of 0.05 or 0.01) as general guidelines to decide if you should reject or keep the null.

When your p-value is less than or equal to your significance level, you reject the null hypothesis.

In other words, smaller p-values are taken as stronger evidence against the null hypothesis. Conversely, when the p-value is greater than your significance level, you fail to reject the null hypothesis.

In this case, the sample data provides insufficient data to conclude that the effect exists in the population.

Because you can never know with complete certainty whether there is an effect in the population, your inferences about a population will sometimes be incorrect.

When you incorrectly reject the null hypothesis, it’s called a type I error. When you incorrectly fail to reject it, it’s called a type II error.

Why Do We Never Accept The Null Hypothesis?

The reason we do not say “accept the null” is because we are always assuming the null hypothesis is true and then conducting a study to see if there is evidence against it. And, even if we don’t find evidence against it, a null hypothesis is not accepted.

A lack of evidence only means that you haven’t proven that something exists. It does not prove that something doesn’t exist. 

It is risky to conclude that the null hypothesis is true merely because we did not find evidence to reject it. It is always possible that researchers elsewhere have disproved the null hypothesis, so we cannot accept it as true, but instead, we state that we failed to reject the null. 

One can either reject the null hypothesis, or fail to reject it, but can never accept it.

Why Do We Use The Null Hypothesis?

We can never prove with 100% certainty that a hypothesis is true; We can only collect evidence that supports a theory. However, testing a hypothesis can set the stage for rejecting or accepting this hypothesis within a certain confidence level.

The null hypothesis is useful because it can tell us whether the results of our study are due to random chance or the manipulation of a variable (with a certain level of confidence).

A null hypothesis is rejected if the measured data is significantly unlikely to have occurred and a null hypothesis is accepted if the observed outcome is consistent with the position held by the null hypothesis.

Rejecting the null hypothesis sets the stage for further experimentation to see if a relationship between two variables exists. 

Hypothesis testing is a critical part of the scientific method as it helps decide whether the results of a research study support a particular theory about a given population. Hypothesis testing is a systematic way of backing up researchers’ predictions with statistical analysis.

It helps provide sufficient statistical evidence that either favors or rejects a certain hypothesis about the population parameter. 

Purpose of a Null Hypothesis 

• The primary purpose of the null hypothesis is to disprove an assumption. 
• Whether rejected or accepted, the null hypothesis can help further progress a theory in many scientific cases.
• A null hypothesis can be used to ascertain how consistent the outcomes of multiple studies are.

Do you always need both a Null Hypothesis and an Alternative Hypothesis?

The null (H0) and alternative (Ha or H1) hypotheses are two competing claims that describe the effect of the independent variable on the dependent variable. They are mutually exclusive, which means that only one of the two hypotheses can be true. 

While the null hypothesis states that there is no effect in the population, an alternative hypothesis states that there is statistical significance between two variables. 

The goal of hypothesis testing is to make inferences about a population based on a sample. In order to undertake hypothesis testing, you must express your research hypothesis as a null and alternative hypothesis. Both hypotheses are required to cover every possible outcome of the study. 

What is the difference between a null hypothesis and an alternative hypothesis?

The alternative hypothesis is the complement to the null hypothesis. The null hypothesis states that there is no effect or no relationship between variables, while the alternative hypothesis claims that there is an effect or relationship in the population.

It is the claim that you expect or hope will be true. The null hypothesis and the alternative hypothesis are always mutually exclusive, meaning that only one can be true at a time.

What are some problems with the null hypothesis?

One major problem with the null hypothesis is that researchers typically will assume that accepting the null is a failure of the experiment. However, accepting or rejecting any hypothesis is a positive result. Even if the null is not refuted, the researchers will still learn something new.

Why can a null hypothesis not be accepted?

We can either reject or fail to reject a null hypothesis, but never accept it. If your test fails to detect an effect, this is not proof that the effect doesn’t exist. It just means that your sample did not have enough evidence to conclude that it exists.

We can’t accept a null hypothesis because a lack of evidence does not prove something that does not exist. Instead, we fail to reject it.

Failing to reject the null indicates that the sample did not provide sufficient enough evidence to conclude that an effect exists.

If the p-value is greater than the significance level, then you fail to reject the null hypothesis.

Is a null hypothesis directional or non-directional?

A hypothesis test can either contain an alternative directional hypothesis or a non-directional alternative hypothesis. A directional hypothesis is one that contains the less than (“<“) or greater than (“>”) sign.

A nondirectional hypothesis contains the not equal sign (“≠”).  However, a null hypothesis is neither directional nor non-directional.

A null hypothesis is a prediction that there will be no change, relationship, or difference between two variables.

The directional hypothesis or nondirectional hypothesis would then be considered alternative hypotheses to the null hypothesis.

Gill, J. (1999). The insignificance of null hypothesis significance testing.  Political research quarterly ,  52 (3), 647-674.

Krueger, J. (2001). Null hypothesis significance testing: On the survival of a flawed method.  American Psychologist ,  56 (1), 16.

Masson, M. E. (2011). A tutorial on a practical Bayesian alternative to null-hypothesis significance testing.  Behavior research methods ,  43 , 679-690.

Nickerson, R. S. (2000). Null hypothesis significance testing: a review of an old and continuing controversy.  Psychological methods ,  5 (2), 241.

Rozeboom, W. W. (1960). The fallacy of the null-hypothesis significance test.  Psychological bulletin ,  57 (5), 416.

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What Is a Null Hypothesis?

How a null hypothesis works, the alternative hypothesis, examples of a null hypothesis.

• Null Hypothesis and Investments
• Null Hypothesis FAQs
• Corporate Finance
• Financial Ratios

Null Hypothesis: What Is It and How Is It Used in Investing?

Adam Hayes, Ph.D., CFA, is a financial writer with 15+ years Wall Street experience as a derivatives trader. Besides his extensive derivative trading expertise, Adam is an expert in economics and behavioral finance. Adam received his master's in economics from The New School for Social Research and his Ph.D. from the University of Wisconsin-Madison in sociology. He is a CFA charterholder as well as holding FINRA Series 7, 55 & 63 licenses. He currently researches and teaches economic sociology and the social studies of finance at the Hebrew University in Jerusalem.

A null hypothesis is a type of statistical hypothesis that proposes that no statistical significance exists in a set of given observations. Hypothesis testing is used to assess the credibility of a hypothesis by using sample data. Sometimes referred to simply as the "null," it is represented as H 0 .

The null hypothesis, also known as the conjecture, is used in quantitative analysis to test theories about markets, investing strategies, or economies to decide if an idea is true or false.

Key Takeaways

• A null hypothesis is a type of conjecture in statistics that proposes that there is no difference between certain characteristics of a population or data-generating process.
• The alternative hypothesis proposes that there is a difference.
• Hypothesis testing provides a method to reject a null hypothesis within a certain confidence level.
• If you can reject the null hypothesis, it provides support for the alternative hypothesis.
• Null hypothesis testing is the basis of the principle of falsification in science.

Investopedia / Alex Dos Diaz

A null hypothesis is a type of conjecture in statistics that proposes that there is no difference between certain characteristics of a population or data-generating process. For example, a gambler may be interested in whether a game of chance is fair. If it is fair, then the expected earnings per play come to zero for both players. If the game is not fair, then the expected earnings are positive for one player and negative for the other. To test whether the game is fair, the gambler collects earnings data from many repetitions of the game, calculates the average earnings from these data, then tests the null hypothesis that the expected earnings are not different from zero.

If the average earnings from the sample data are sufficiently far from zero, then the gambler will reject the null hypothesis and conclude the alternative hypothesis—namely, that the expected earnings per play are different from zero. If the average earnings from the sample data are near zero, then the gambler will not reject the null hypothesis, concluding instead that the difference between the average from the data and zero is explainable by chance alone.

The null hypothesis assumes that any kind of difference between the chosen characteristics that you see in a set of data is due to chance. For example, if the expected earnings for the gambling game are truly equal to zero, then any difference between the average earnings in the data and zero is due to chance.

Analysts look to reject   the null hypothesis because doing so is a strong conclusion. This requires strong evidence in the form of an observed difference that is too large to be explained solely by chance. Failing to reject the null hypothesis—that the results are explainable by chance alone—is a weak conclusion because it allows that factors other than chance may be at work but may not be strong enough for the statistical test to detect them.

A null hypothesis can only be rejected, not proven.

An important point to note is that we are testing the null hypothesis because there is an element of doubt about its validity. Whatever information that is against the stated null hypothesis is captured in the alternative (alternate) hypothesis (H1).

For the above examples, the alternative hypothesis would be:

• Students score an average that is  not  equal to seven.
• The mean annual return of the mutual fund is  not  equal to 8% per year.

In other words, the alternative hypothesis is a direct contradiction of the null hypothesis.

Here is a simple example: A school principal claims that students in her school score an average of seven out of 10 in exams. The null hypothesis is that the population mean is 7.0. To test this null hypothesis, we record marks of, say, 30 students (sample) from the entire student population of the school (say 300) and calculate the mean of that sample.

We can then compare the (calculated) sample mean to the (hypothesized) population mean of 7.0 and attempt to reject the null hypothesis. (The null hypothesis here—that the population mean is 7.0—cannot be proved using the sample data. It can only be rejected.)

Take another example: The annual return of a particular  mutual fund  is claimed to be 8%. Assume that a mutual fund has been in existence for 20 years. The null hypothesis is that the mean return is 8% for the mutual fund. We take a random sample of annual returns of the mutual fund for, say, five years (sample) and calculate the sample mean. We then compare the (calculated) sample mean to the (claimed) population mean (8%) to test the null hypothesis.

For the above examples, null hypotheses are:

• Example A : Students in the school score an average of seven out of 10 in exams.
• Example B: Mean annual return of the mutual fund is 8% per year.

For the purposes of determining whether to reject the null hypothesis, the null hypothesis (abbreviated H 0 ) is assumed, for the sake of argument, to be true. Then the likely range of possible values of the calculated statistic (e.g., the average score on 30 students’ tests) is determined under this presumption (e.g., the range of plausible averages might range from 6.2 to 7.8 if the population mean is 7.0). Then, if the sample average is outside of this range, the null hypothesis is rejected. Otherwise, the difference is said to be “explainable by chance alone,” being within the range that is determined by chance alone.

How Null Hypothesis Testing Is Used in Investments

As an example related to financial markets, assume Alice sees that her investment strategy produces higher average returns than simply buying and holding a stock . The null hypothesis states that there is no difference between the two average returns, and Alice is inclined to believe this until she can conclude contradictory results.

Refuting the null hypothesis would require showing statistical significance, which can be found by a variety of tests. The alternative hypothesis would state that the investment strategy has a higher average return than a traditional buy-and-hold strategy.

One tool that can determine the statistical significance of the results is the p-value. A p-value represents the probability that a difference as large or larger than the observed difference between the two average returns could occur solely by chance.

A p-value that is less than or equal to 0.05 often indicates whether there is evidence against the null hypothesis. If Alice conducts one of these tests, such as a test using the normal model, resulting in a significant difference between her returns and the buy-and-hold returns (the p-value is less than or equal to 0.05), she can then reject the null hypothesis and conclude the alternative hypothesis.

How Is the Null Hypothesis Identified?

The analyst or researcher establishes a null hypothesis based on the research question or problem that they are trying to answer. Depending on the question, the null may be identified differently. For example, if the question is simply whether an effect exists (e.g., does X influence Y?) the null hypothesis could be H 0 : X = 0. If the question is instead, is X the same as Y, the H0 would be X = Y. If it is that the effect of X on Y is positive, H0 would be X > 0. If the resulting analysis shows an effect that is statistically significantly different from zero, the null can be rejected.

How Is Null Hypothesis Used in Finance?

In finance, a null hypothesis is used in quantitative analysis. A null hypothesis tests the premise of an investing strategy, the markets, or an economy to determine if it is true or false. For instance, an analyst may want to see if two stocks, ABC and XYZ, are closely correlated. The null hypothesis would be ABC ≠ XYZ.

How Are Statistical Hypotheses Tested?

Statistical hypotheses are tested by a four-step process . The first step is for the analyst to state the two hypotheses so that only one can be right. The next step is to formulate an analysis plan, which outlines how the data will be evaluated. The third step is to carry out the plan and physically analyze the sample data. The fourth and final step is to analyze the results and either reject the null hypothesis or claim that the observed differences are explainable by chance alone.

What Is an Alternative Hypothesis?

An alternative hypothesis is a direct contradiction of a null hypothesis. This means that if one of the two hypotheses is true, the other is false.

Sage Publishing. " Chapter 8: Introduction to Hypothesis Testing ," Pages 4–7.

Sage Publishing. " Chapter 8: Introduction to Hypothesis Testing ," Page 4.

Sage Publishing. " Chapter 8: Introduction to Hypothesis Testing ," Page 7.

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T-Test in Statistics: Formula, Types and Steps

T-Test is a method used in statistics to determine if there is a significant difference between the means of two groups and how they are related. In T-Test statistics, the sample data is a subset of the two groups that we use to draw conclusions about the groups as a whole. 

For example, if we want to know the average weight of mangoes grown on a farm, the population would consist of all the mangoes that grew on the farm. However, it would be time-consuming to weigh each mango. Instead, we could take a sample of mangoes from trees at different locations on the farm and use their weights to make inferences about the average weight of all the mangoes grown on the farm.

T-Test Definition

T-Test is a statistics method to determine significance changes between means of two groups. It helps us to determine whether the data sets belong to the same group or not. This comparison is often called a T-test.

T-Test Formula

There is no specific formula for T-Test, as it is divided into various types such as One Samples T-Test, Independent Samples T-test, etc. which are used as per the need. The formula used in each type is defined under the specific headings. The formula allows us to calculate a T-value which helps to make a comparison between the data sets.

Value of T-Test

The value obtained by substituting required values to the t-test formula is called the t-value. A larger T-value implies that the sets belong to a different population, while a smaller T-value implies that they belong to the same population. The formula is comprised of the values of mean, standard deviation and variance of the data sets under consideration.

How to Calculate T Value in T-Test

To calculate T-value in T-Test, we can use the following steps:

Step 1: To perform a T-test, two hypotheses namely the null hypothesis and the alternative hypothesis are defined which have different meanings for different types of T-tests.

Step 2: And, a value for the level of significance is defined which signifies the probability of making a Type I error, which implies the rejection of the null hypothesis while it is actually true. Commonly used values of level of significance are 0.05 (5%) and 0.01 (1%).

Step 3: A higher significance level, such as α = 0.05, provides a higher tolerance for Type I errors, meaning that it is more likely to reject the null hypothesis even when it is true.

Step 4: On the other hand, a lower significance level, such as α = 0.01, reduces the risk of Type I errors but it may increase the chances of accepting the null hypothesis when it is actually false, resulting in a Type II error.

Types of T-Test

Below are the three types of T-Test mentioned below.

• One Sample T-test
• Independent Samples T-test
• Paired Samples T-test

Let’s discuss these types in detail as follows:

One Sample T-Test

As the name implies, this test is used when we have one data set for a sample and we need to determine whether this data set belongs to a particular population or not. The mean value for the population data must be known in this case. The formula to determine T-value, in this case, is as follows:

t = (x̄ – μ) / (σ / √n) Where, t is the t-value, x̄ is the Sample mean, μ is the Population mean, σ is the Sample standard deviation, and n is the Sample size.

Steps to Calculate T Value One Sample T-Test 

To perform the One Sample T-test, the steps listed below are generally followed:

Step 1: State a null hypothesis and an alternative hypothesis. The null hypothesis assumes that the sample mean and the known population mean (μ) are equal, while the other assumes that the sample mean is different from the population mean.

Step 2: Define values for the level of significance (α) and the degree of freedom (df). The degree of freedom equals (n – 1) for this case.

Step 3: Calculate the t-value using the formula stated above by putting all the known values of the sample mean (x̄), sample standard deviation (σ), the population mean (μ), and the sample size (n).

Step 4: Determine the associated p-value with the t-value using a t-distribution table.

Step 5: Compare the p-value to the level of significance. If the p-value is less than the level of significance, reject the null hypothesis and conclude that the sample mean is significantly different from the population mean. Otherwise, conclude that there is no significant difference between the sample mean and the population mean.

Independent Samples T-Test

As the name suggests, an Independent samples T-test is used when we need to compare the statistical means of two independent samples or groups. It helps us determine whether there is a significant difference between the means of the two groups. If there is a significant difference, it suggests that the groups likely have different population means; otherwise, they have the same population means.

For example, when an investigation aims to determine if there is a significant difference in the mean scores between athletes who follow a specific training camp (Team A) and those who do not (Team B), an independent samples t-test can be conducted.

This test is performed using either of two assumptions made about variances of the samples, one assumes equal variances for the sample and the other assumes unequal variances for the samples.

Unequal Variances T-Test

Under this test, variances of two groups considered are assumed to be equal. This is appropriate when we are uncertain about the variances of the two groups considered. The formula to calculate T-value, in this case, is as follows:

t = (x̄ 1 – x̄ 2 ) / √((σ 1 2 /n 1 ) + (σ 2 2 /n 2 )) Where, x̄ 1 is the sample mean of Group 1, x̄ 2 is the sample mean of Group 2, σ 1 is the sample standard deviation of Group 1, σ 2 is the sample standard deviation of Group 2, n 1 is the sample size of Group 1, and n 2 sample size of Group 2.

Equal Variance T-Test

Under this test, variances of two groups considered are assumed to be equal. This is appropriate when we have some assurance about variances of data considered to be equal. The formula to calculate T-value, in this case, is similar to the above formula with a slight change that σ 1 = σ 2 = σ.

t = (x̄ 1 – x̄ 2 ) / √(σ 2 (1/n 1 + 1/n 2 )) Where, x̄ 1 is the sample mean of Group 1, x̄ 2 is the sample mean of Group 2, σ is the standard deviation of both groups, n 1 is the sample size of Group 1, and n 2 sample size of Group 2.

T Test for Independent Samples

The steps listed below are generally followed to perform this test:

Step 1: State a null hypothesis and an alternate hypothesis. The null hypothesis assumes that the means of the two groups are equal (x̄ 1 = x̄ 2 ), while the other assumes that the means of the two groups are significantly different (x̄ 1 ≠ x̄ 2 ).

Step 2: Define the values for the level of significance (α) and the degrees of freedom (df). The degree of freedom equals (n 1 + n 2 – 2) in this case.

Step 3: Calculate the t-value from the formula defined above after obtaining the required data related to each group.

Step 4: Find the critical t-value from a t-distribution table with the corresponding degrees of freedom and level of significance.

Step 5: If the calculated t-value is greater than the critical t-value, then reject the null hypothesis. This indicates that there is a significant difference between the means of the two groups. Otherwise, the null hypothesis is not rejected. And, this suggests that there is no significant difference between the means of the two groups.

Paired Samples T-Test

The Paired samples t-test is used when we want to compare the means of two related groups or samples. For example, we may use this test to compare the average scores of the players of an athletics team before and after a training program. To calculate the t-value in this case, the following formula is used,

t = (x̄ d – μ d ) / (σ d / √n) Where: t is the t-value, x̄ d is the sample mean of the differences between the paired observations, μ d isthe population mean difference, σ d is the sample standard deviation of the differences, n is the number of paired observations.

Steps for Paired Samples T-Test

Following are the steps to perform this type of T-test:

Step 1: State the null hypothesis which assumes that there is no significant difference between the statistical means of the paired observations (μ d = 0) while the alternative hypothesis assumes that there is a significant difference between the statistical means of the paired observations (μ d ≠ 0).

Step 2: Match each observation in one group with a corresponding observation in the other group.

Step 3: Calculate the differences between each paired observation and then, calculate the mean of the differences (x̄ d ), and the sample standard deviation of the differences (σ d ). Furthermore, calculate the t-value from the formula.

Step 4: Obtain the critical t-value from a t-distribution table corresponding to the chosen level of significance (α) and degree of freedom (df). The degree of freedom (df) equals (n – 1) in this case.

Step 5: If the calculated t-value is greater than the critical t-value, then reject the null hypothesis. This indicates a significant difference in the sample before and after the intervention. Otherwise, it can be concluded that there is no significant difference in the sample before and after the intervention.

T-Distribution Table

A T-Distribution table is used to obtain a critical t-value that is used as a reference to the calculated t-value for obtaining further results. Critical t-value depends on values of the level of significance and degrees of freedom. A concise form of the table for critical t-values is as follows for your reference:

Solved Problems of T-Test Formula

Problem 1: Determine whether the average weight of a sample of 20 mangoes is significantly different from the population’s average weight of 70 grams. The sample mean weight is 70.55 grams, and the sample standard deviation is 2.82 grams. Use one sample T-test.

To perform a T-test, first of all, we define two hypotheses: Null hypothesis: The sample mean weight of mangoes is equal to the known population mean. (i.e., 70 grams). Alternative hypothesis: The sample mean weight of mangoes is not equal to the known mean value. Then, determine the degrees of freedom (d f ): d f = n – 1 = 20 – 1 = 19 and define the level of significance(α) as 0.05 for this case. Next, determine the t-value from the formula, t = (70.55 – 70) / (2.82 / √20) ⇒ t ≈ 1.041 From the t-distribution table, we find 1.041 < 2.093. (i.e. p-value for α = 0.05). So, the null hypothesis is true. Thus, we conclude that the sample does not vary significantly from the population.

Problem 2: Determine if there is a significant difference in the average scores between the two teams. The following data is given:  Team A: Score: 65, 68, 70, 63, 67 Team B: Score: 62, 66, 69, 64, 68

According to the question, we come to know that we need to perform an Independent Samples T-test. Set up the null hypothesis and alternative hypothesis: Null hypothesis: The means of the two groups are equal (μ A = μ B ). Alternative hypothesis: The means of the two groups are not equal (μ A ≠ μ B ). Next, we calculate the sample means (x̄ A and x̄ B ) and sample standard deviations (σ A and σ B ): Team A: Sample size (n A ) = 5 Sample mean (x̄ A ) = (65 + 68 + 70 + 63 + 67) / 5 = 66.6 Sample standard deviation (σ A ) ≈ 2.607 Team B: Sample size (n B ) = 5 Sample mean (x̄ B ) = (62 + 66 + 69 + 64 + 68) / 5 = 65.8 Sample standard deviation (σ B ) ≈ 2.588 Now, we calculate the t-value using the formula: t = (x̄ A – x̄ B ) / √((σ A 2 / n A ) + (σ B 2 / n B )) ⇒ t = (66.6 – 65.8) / √{(2.607 2 /5) + (2.588 2 /5)} ⇒ t ≈ 0.296 Then, determine the degrees of freedom (df):  df = n A + n B – 2 = 5 + 5 – 2 = 8  and set the level of significance as 0.05.  From the table, we get the critical t-value as 2.306. As the calculated t-value is less than the critical t-value, we conclude that the null hypothesis is not rejected, which suggests that there is no significant difference between the average scores of the two teams.

Problem 3: You need to assess the effectiveness of a new teaching scheme by comparing the test scores of the same group of students before and after the implementation of the scheme. The following data is given: Before scores: 76, 88, 65, 56, 76 After scores: 85, 95, 75, 60, 81 Determine if there is a significant difference in the average test scores before and after the implementation of the scheme.

Here, we need to perform a Paired Samples T-test, as we need to compare data of the same sample. Set up the null hypothesis and alternative hypothesis: Null hypothesis: The population mean difference between the before and after scores are zero (μ d = 0). Alternative hypothesis: The population mean difference between the before and after scores is not zero (μ d ≠ 0). Next, calculate the differences between the paired observations: Difference (d) = After score – Before score d 1 = 85 – 76 = 9 d 2 = 95 – 88 = 7 d 3 = 75 – 65 = 10 d 4 = 60 – 56 = 4 d 5 = 81 – 76 = 5 Now, calculate the sample mean (x̄d) and sample standard deviation (σ d ) of the differences: Sample size (n) = 5 Sample mean (x̄ d ) = (d 1 + d 2 + d 3 + d 4 + d 5 ) / 5 = (9 + 7 + 10 + 4 + 5) / 5 = 7 Sample standard deviation (σ d ) ≈ 2.828 Then, calculate the t-value using the formula: t = (x̄ d – μ d ) / (σ d / √n)  ⇒ t = (7 – 0) / (2.828 / √5) ⇒ t ≈ 5.535 Next, calculate the value of degrees of freedom (df):  df = n – 1 = 5 – 1 = 4.  And, define the level of significance(α) as 0.05.  Now, from the t-distribution table, we find that the critical t-value is 2.776. As the calculated t-value is greater than the critical t-value ( 5.535 > 2.776), thus, the null hypothesis is rejected. And we conclude that there is a significant difference in the average test scores before and after the implementation of the scheme.

T-Test in Statistics – FAQs

What is a t-test in statistics.

T-Test is the test in statistics to derive some conclusions for a population which is based upon some sample data using values of means and variances. 

When is a T-Test used?

The test is basically used to determine whether there is any significant difference in the statistical means of two samples of the data considered. The purpose to determine this can be to check if a sample data set belongs to the population data set, or if there is an effect of any variation on the data values before or after any specific treatment/intervention.

What are the Different Types of T-Tests?

There are three types of T-tests that are used as per the situation, listed as follows: One-sample T-test: It is used when we need to compare the mean of a single sample to a known (or assumed) population mean value. Independent T-test: It is used when we need to compare the means of two independent groups. Paired T-test: It is used to compare the means of two related or paired groups.

What does the T-Value obtain from the T-Test Formula Indicate?

The t-value indicates the magnitude of the difference between the means relative to the variability within the groups. A larger t-value suggests a greater difference between the means.

Are there any Assumptions related to Sample Data in Performing a T-Test on it?

The t-test assumes that the data within each group are normally distributed, the variances of the two groups are equal (in the case of an independent t-test), the observations are independent, and the data points represent their respective populations.

What are the Limitations of the T-Test?

The t-test assumes that the data meet the assumptions of normality, independence, and equal variances (in the case of an independent t-test). If these assumptions are not true, it can lead to inaccurate or misleading results. Also, the test is sensitive to outliers, and may not give accurate results for small sample sizes.

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