WGU C723 QUANTITATIVE ANALYSIS
FOR BUSINESS- STUDY GUIDE
Hypothesis - is an assumption about a population parameter such as a mean or a proportion
null hypothesis (H0) - -represents the status quo
-states a belief that the population parameter is ≤, =, or ≥ a specific value
-believed to be true unless there is overwhelming evidence to the contrary
alternative hypothesis (H1) - -represents the opposite of the null hypothesis
-believed to be true if the null hypothesis is found to be false
-always states that the population parameter is >, ≠, or < a specific value
two-tail hypothesis test - is used whenever the alternative hypothesis is expressed as ≠
one-tail hypothesis test - is used when the alternative hypothesis is stated as < or >
Type I error - -occurs when the null hypothesis is rejected when it is true
-when it occurs the producer is looking for a problem in its process that does not exist
, Type II error - -occurs when we fail to reject the null hypothesis when it is not true
-when it occurs the customer is getting a product from a process that is not performing properly
Correlation analysis - -is used to measure both the strength and direction of a linear
relationship between two variables
-A relationship is linear if the scatter plot of the independent and dependent variables has a
straight-line pattern
correlation coefficient, r - -indicates both the strength and direction of the linear relationship
between the independent and dependent variables
population correlation coefficient (ρ) - refers to the correlation between all values of two
variables of interest in a population
confidence interval for the mean - is an interval estimate around a sample mean that provides us
with a range within which the true population mean is expected to lie
confidence level - is defined as the probability that the interval estimate will include the
population parameter of interest
Student's t-distribution - is used in place of the normal probability distribution when the
sample standard deviation, s, is used in place of the population standard deviation, σ
probability sample - is a sample in which each member of the population has a known, nonzero,
chance of being selected for the sample
simple random sample - is a sample in which every member of the population has an equal
chance of being chosen
FOR BUSINESS- STUDY GUIDE
Hypothesis - is an assumption about a population parameter such as a mean or a proportion
null hypothesis (H0) - -represents the status quo
-states a belief that the population parameter is ≤, =, or ≥ a specific value
-believed to be true unless there is overwhelming evidence to the contrary
alternative hypothesis (H1) - -represents the opposite of the null hypothesis
-believed to be true if the null hypothesis is found to be false
-always states that the population parameter is >, ≠, or < a specific value
two-tail hypothesis test - is used whenever the alternative hypothesis is expressed as ≠
one-tail hypothesis test - is used when the alternative hypothesis is stated as < or >
Type I error - -occurs when the null hypothesis is rejected when it is true
-when it occurs the producer is looking for a problem in its process that does not exist
, Type II error - -occurs when we fail to reject the null hypothesis when it is not true
-when it occurs the customer is getting a product from a process that is not performing properly
Correlation analysis - -is used to measure both the strength and direction of a linear
relationship between two variables
-A relationship is linear if the scatter plot of the independent and dependent variables has a
straight-line pattern
correlation coefficient, r - -indicates both the strength and direction of the linear relationship
between the independent and dependent variables
population correlation coefficient (ρ) - refers to the correlation between all values of two
variables of interest in a population
confidence interval for the mean - is an interval estimate around a sample mean that provides us
with a range within which the true population mean is expected to lie
confidence level - is defined as the probability that the interval estimate will include the
population parameter of interest
Student's t-distribution - is used in place of the normal probability distribution when the
sample standard deviation, s, is used in place of the population standard deviation, σ
probability sample - is a sample in which each member of the population has a known, nonzero,
chance of being selected for the sample
simple random sample - is a sample in which every member of the population has an equal
chance of being chosen
