In: Statistics and Probability
Trying to understand the following topic, how would you explain the response to these questions in a few sentences.
What is the purpose of a critical value. What is it used for?
Also, explain the difference in a one-tail test and two-tailed
test. What causes these to be different and where would you use a
one-tail test instead of a two-tailed test?
In hypothesis testing, a critical value is a point on the test distribution that is compared to the test statistic to determine whether to reject the null hypothesis. If the absolute value of the test statistic is greater than the critical value then we can declare the statistical significance. So, this is the critical value and this is used to either accept or reject the null hypothesis.
One tailed tests have more statistical power to detect an effect in one direction than a two tailed tests with the same design and significance level. One tailed tests occur most frequently for studies where on of the following is true : Effects can exist in only one direction.
This is because a two tailed test uses both the positive and negative tails of the distribution. In other words, it tests for the possibility of positive and negative differences. A one tailed test is appropriate if we only want to determine if there is a difference between groups in a specific direction.