askvity

How to Find the Critical Value

Published in Statistical Analysis 3 mins read

Finding the critical value is a crucial step in hypothesis testing, allowing you to determine whether to reject or fail to reject the null hypothesis. Here's a breakdown of how to find it, based on your provided references:

Steps to Find the Critical Value

The process involves a few key steps:

  1. Determine the Alpha Level (α):

    • The alpha level, denoted as α, represents the probability of rejecting the null hypothesis when it is actually true (Type I error). Common alpha levels are 0.05 (5%) and 0.01 (1%).
  2. Calculate the Area for Your Test:

    • Two-Tailed Test: If you are conducting a two-tailed test (where you are interested in whether the sample mean is different in either direction from the population mean), subtract the alpha level directly from 1.
    • Formula for Two-Tailed Test Area: Area = 1 - α
    • One-Tailed Test: If you are conducting a one-tailed test (where you are interested in whether the sample mean is greater than or less than the population mean), subtract the alpha level from 0.5.
    • Formula for One-Tailed Test Area: Area = 0.5 - α
  3. Look Up the Critical Value:

    • Once you've calculated the relevant area, use the z-distribution table (also known as the standard normal table) to find the corresponding z-score. This z-score represents the critical value.
    • The z-distribution table provides the area to the left of a given z-score. You'll need to locate the area you calculated in step 2 and then find the corresponding z-score.

Example

Let’s illustrate with an example. Suppose you have a two-tailed test with an alpha level of 0.05:

  • Step 1: α = 0.05
  • Step 2: Area = 1 - 0.05 = 0.95. Now we need to find the areas on each tail which means dividing the alpha by two (0.05/2 =0.025). Therefore, the area in each tail = 0.025 and the area to the left of the critical value is 0.975 (1-0.025=0.975).
  • Step 3: Locate 0.975 on a z-table which will correspond to the z-score or critical value of 1.96.

Summary

Step Description
1. Find Alpha Level (α) Determine the acceptable risk of a Type I error (e.g., 0.05, 0.01).
2. Calculate Test Area Subtract α from 1 for a two-tailed test, or subtract α from 0.5 for a one-tailed test.
3. Look Up Critical Value Use the z-distribution table to find the z-score corresponding to the calculated area. This is your critical value.

By following these steps, you can accurately find the critical value, an important element in your hypothesis testing.

Related Articles