Many hypotheses testing situations involve proportions. A proportion is the same as percentage of the population. A hypotheses test involving a population proportion can be considered as a binomial experiment when there are only two outcomes and the probability of success does not change from trial. The mean is µ = np and the standard deviation is σ = √npq for binomial. Since the normal distribution can be used to approximate the binomial distribution when np ≥ 5 and nq ≥ 5, the standard normal distribution can be used to test hypotheses for proportions.
Formula for the Z-test of Proportion: The steps for hypotheses testing are the same as those in t-test, expect to use Table E to find the critical values and P-values.
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The formula is derived from the normal approximation to the binomial and follows the general formula:
Posted By: J-Lynn B. Ramos
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