TECHNOLOGY OVERVIEW
# Hypothesis testing for the mean from a normal variate

Hypothesis testing for the mean requires the following steps

- Sample n items randomly
- Calculate the average and standard deviation
- Specify a level of significance
- Specify an equality (<. > or <>)
- Specify a reference value
- Determine the test statistic with the following expression
- (Sample average – reference value)/(sample standard deviation/sqrt(sample size))

- Determine the critical region for the test statistic. The critical region depends on the equality i.e. < or > or <>.
- Compare the test statistic with the Critical region and conclude significance if the test statistic falls outside the critical region.

Alternatively, a p-value can be calculated and if the p-value falls below the specified level of significance the Null Hypothesis is rejected and the alternative hypothesis is accepted.

BIS.Net Analyst and the BIS.Net Inferences APP both use p-values for hypothesis testing as these are more flexible than imposing a predefined level of significance on users. The lower the p-value below .05 the better. Both BISNET Analyst and BISNET Inferences plot a p curve to provide additional insights.

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