9-1

COMPLETE
BUSINESS
STATISTICS

by
AMIR D. ACZEL
&
JAYAVEL SOUNDERPANDIAN
6th edition (SIE)

9-2

Chapter 9
Analysis of Variance

9-3

9 Analysis of Variance

Using Statistics
The Hypothesis Test of Analysis of Variance
The Theory and Computations of ANOVA
The ANOVA Table and Examples
Further Analysis
Models, Factors, and Designs
Two-Way Analysis of Variance
Blocking Designs

9-4

9 LEARNING OBJECTIVES
After studying this chapter you should be able to:

Explain the purpose of ANOVA

Describe the model and computations behind ANOVA
Explain the test statistic F
Conduct a 1-way ANOVA
Report ANOVA results in an ANOVA table
Apply Tukey test for pair-wise analysis
Conduct a 2-way ANOVA
Explain blocking designs
Apply templates to conduct 1-way and 2-way ANOVA

9-5

9-1 Using Statistics

ANOVA (ANalysis Of VAriance) is a statistical

method for determining the existence of differences
among several population means.
ANOVA is

designed to detect differences among means

from populations subject to different treatments
ANOVA is a joint test
The equality of several population means is tested
simultaneously or jointly.
ANOVA tests for the equality of several population
means by looking at two estimators of the population
variance (hence, analysis of variance).

9-2 The Hypothesis Test of

Analysis of Variance

In an analysis of variance:
We

have r independent random samples, each one

corresponding to a population subject to a different
treatment.
We have:

n = n1+ n2+ n3+ ...+nr total observations.

r sample means: x1, x2 , x3 , ... , xr

These r sample means can be used to calculate an estimator of

the population variance. If the population means are equal, we
expect the variance among the sample means to be small.

r sample variances: s12, s22, s32, ...,sr2

These sample variances can be used to find a pooled estimator

of the population variance.

9-6

9-7

9-2 The Hypothesis Test of Analysis of

Variance (continued): Assumptions
Weassume
assumeindependent
independentrandom
randomsampling
samplingfrom
fromeach
eachof
ofthe
the
We
populations
rrpopulations
Weassume
assumethat
thatthe
therrpopulations
populationsunder
understudy:
study:
We

arenormally
normallydistributed,
distributed,
are

withmeans
meansi ithat
thatmay
mayor
ormay
maynot
notbe
beequal,
equal,
with
butwith
withequal
equalvariances,
variances,i2i.2.
but

Population 1

Population 2

Population 3

9-2 The Hypothesis Test of Analysis of

Variance (continued)
Thehypothesis
hypothesistest
testof
ofanalysis
analysisof
ofvariance:
variance:
The
HH00::11==22==33==44==......r r
Notall
alli(i(i==1,1,...,
...,r)r)are
areequal
equal
HH11::Not
i
Thetest
teststatistic
statisticof
ofanalysis
analysisof
ofvariance:
variance:
The
=
FF(r-1,
(r-1,n-r)
n-r) =

Estimateofofvariance
variancebased
basedon
onmeans
meansfrom
fromr rsamples
samples
Estimate
Estimateofofvariance
variancebased
basedon
onall
allsample
sampleobservations
observations
Estimate

Thatis,
is,the
thetest
teststatistic
statisticininan
ananalysis
analysisof
ofvariance
varianceisisbased
basedon
onthe
theratio
ratioof
of
That
twoestimators
estimatorsof
ofaapopulation
populationvariance,
variance,and
andisistherefore
thereforebased
basedon
onthe
theFF
two
distribution,with
with(r-1)
(r-1)degrees
degreesof
offreedom
freedomininthe
thenumerator
numeratorand
and(n-r)
(n-r)
distribution,
degreesof
offreedom
freedomininthe
thedenominator.
denominator.
degrees

9-8

9-9

When the Null Hypothesis Is True

Whenthe
thenull
nullhypothesis
hypothesisisistrue:
true:
When

Wewould
wouldexpect
expectthe
thesample
samplemeans
meanstotobe
benearly
nearly
We
equal,as
asininthis
thisillustration.
illustration. And
Andwe
wewould
would
equal,
expectthe
thevariation
variationamong
amongthe
thesample
samplemeans
means
expect
(betweensample)
sample)totobe
besmall,
small,relative
relativetotothe
the
(between
variationfound
foundaround
aroundthe
theindividual
individualsample
sample
variation
means(within
(withinsample).
sample).
means
thenull
nullhypothesis
hypothesisisistrue,
true, the
thenumerator
numeratorinin
IfIfthe
thetest
teststatistic
statisticisisexpected
expectedtotobe
besmall,
small,relative
relative
the
thedenominator:
denominator:
totothe

=
(r-1, n-r)
FF(r-1,
n-r)=
x

Estimate of variance based on means from r samples

Estimate of variance based on means from r samples

Estimate of variance based on all sample observations

Estimate of variance based on all sample observations

9-10

When the Null Hypothesis Is False

When the null hypothesis is false:

is equal to but not to ,
is equal to but not to ,
is equal to but not to
, or
, , and are all unequal.

Inany
anyof
ofthese
thesesituations,
situations,we
wewould
wouldnot
notexpect
expectthe
thesample
samplemeans
meanstotoall
allbe
benearly
nearly
In
equal. We
Wewould
wouldexpect
expectthe
thevariation
variationamong
amongthe
thesample
samplemeans
means(between
(between
equal.
sample)totobe
belarge,
large,relative
relativetotothe
thevariation
variationaround
aroundthe
theindividual
individualsample
samplemeans
means
sample)
(withinsample).
sample).
(within
thenull
nullhypothesis
hypothesisisisfalse,
false, the
thenumerator
numeratorininthe
thetest
teststatistic
statisticisisexpected
expectedtotobe
be
IfIfthe
large,relative
relativetotothe
thedenominator:
denominator:
large,
Estimate of variance based on means from r samples
= Estimate
of variance based on means from r samples
(r-1, n-r)
FF(r-1,
=
n-r)

Estimate of variance based on all sample observations

Estimate of variance based on all sample observations

9-11

The ANOVA Test Statistic for r = 4 Populations and n

= 54 Total Sample Observations
Supposewe
wehave
have44populations,
populations,from
fromeach
eachof
ofwhich
whichwe
we
Suppose

drawan
anindependent
independentrandom
randomsample,
sample,with
withnn11++nn22++nn33++
draw
54. Then
Thenour
ourtest
teststatistic
statisticis:
is:
nn44==54.
Estimateofofvariance
variancebased
basedon
onmeans
meansfrom
from44samples
samples
= F(3,50) =Estimate
FF(4-1,
(4-1, 54-4)

54-4)= F(3,50) =
Estimateofofvariance
variancebased
basedon
onall
all54
54sample
sampleobservations
observations
Estimate

F Distribution with 3 and 50 Degrees of Freedom

0.7
0.6

f(F)

0.5
0.4
0.3
0.2

=0.05

0.1
0.0
0

3
2.79

F(3,50)

The nonrejection region (for =0.05)in this

instance is F 2.79, and the rejection region
is F > 2.79. If the test statistic is less than
2.79 we would not reject the null hypothesis,
and we would conclude the 4 population
means are equal. If the test statistic is
greater than 2.79, we would reject the null
hypothesis and conclude that the four
population means are not equal.

9-12

Example 9-1
Randomlychosen
chosengroups
groupsofofcustomers
customerswere
wereserved
serveddifferent
differenttypes
typesofofcoffee
coffeeand
andasked
askedtotorate
ratethe
the
Randomly
coffeeon
onaascale
scaleofof00toto100:
100:21
21were
wereserved
servedpure
pureBrazilian
Braziliancoffee,
coffee,20
20were
wereserved
servedpure
pureColombian
Colombian
coffee
coffee,and
and22
22were
wereserved
servedpure
pureAfrican-grown
African-growncoffee.
coffee.
coffee,
Theresulting
resultingtest
teststatistic
statisticwas
wasFF==2.02
2.02
The
F Distribution with 2 and 60 Degrees of Freedom

F 2.02 F

2,60

3.15

H0 cannot be rejected, and we cannot conclude that any of the

population means differs significantly from the others.

0.7
0.6
0.5

f(F)

H0 : 1 2 3
H1: Not all three means equal
n1 = 21 n 2 = 20 n3 = 22 n = 21+ 20 + 22 = 63
r =3
The critical point for = 0.05 is:
F
F
F
3.15
r -1,n-r
31,633
2,60

0.4
0.3
0.2

=0.05

0.1
0.0
0

Test Statistic=2.02

F(2,60)=3.15

9-13

9-3 The Theory and the Computations

of ANOVA: The Grand Mean
Thegrand
grandmean,
mean,
themean
meanof
ofall
allnn== nn+
mean x,x,isisthe
1+ n2+ n3+...+ nr observations
The
mean
1 n2+ n3+...+ nr observations
allrrsamples.
samples.
ininall
The mean of sample i (i = 1,2,3,..., r) :
ni
xij
j
xi = 1
ni
The grand mean, the mean of all data points :
r ni
r
xij ni xi
xi = i1 j 1 = i1
n
n
where x is the particular data point in position j within the sample from population i.
ij
The subscript i denotes the population, or treatment, and runs from 1 to r. The subscript j
denotes the data point within the sample from population i; thus, j runs from 1 to n .
j

9-14

Using the Grand Mean: Table 9-1

Treatment (j)

Sample point(j)

I = 1 Triangle
1
Triangle
2
Triangle
3
Triangle
4
Mean of Triangles
I = 2 Square
1
Square
2
Square
3
Square
4
Mean of Squares
I = 3 Circle
1
Circle
2
Circle
3
Mean of Circles
les
Grand mean of all data points

Value(x ij)
4
5
7
8
6
10
11
12
13
11.5
1
2
3
2
6.909

x1=6
x2=11.5
x=6.909

x3=2
0

10

Distance from data point to its sample mean

Distance from sample mean to grand mean
ther rpopulation
populationmeans
meansare
aredifferent
different(that
(thatis,is,atat
IfIfthe
leasttwo
twoofofthe
thepopulation
populationmeans
meansare
arenot
notequal),
equal),
least
thenititisislikely
likelythat
thatthe
thevariation
variationofofthe
thedata
data
then
pointsabout
abouttheir
theirrespective
respectivesample
samplemeans
means
points
(within sample
samplevariation)
variation)will
willbe
besmall
smallrelative
relative
(within
thevariation
variationofofthe
ther rsample
samplemeans
meansabout
aboutthe
the
totothe
grandmean
mean(between
(betweensample
samplevariation).
variation).
grand

9-15

The Theory and Computations of ANOVA:

Error Deviation and Treatment Deviation
We define an error devi ation as the difference between a data point
and its sample mean. Errors are denoted by e, and we have:

xx
xx
ee
ij
ij

ij
ij

We define a treatment deviation as the deviation of a sample mean

from the grand mean. Treatment deviations, ti , are given by:

tt xx xx
i

TheANOVA
ANOVAprinciple
principlesays:
says:
The
Whenthe
thepopulation
populationmeans
meansare
arenot
notequal,
equal,the
theaverage
averageerror
error
When
(withinsample)
sample) isisrelatively
relativelysmall
smallcompared
comparedwith
withthe
theaverage
average
(within
treatment(between
(betweensample)
sample)deviation.
deviation.
treatment

9-16

The Theory and Computations of

ANOVA: The Total Deviation

Thetotal
totaldeviation
deviation(Tot
(Totij))isisthe
thedifference
differencebetween
betweenaadata
datapoint
point(x
(xij))and
andthe
thegrand
grandmean
mean(x):
(x):
The
ij
ij
Totij=x
=xij--xx
Tot
ij

ij

Forany
anydata
datapoint
pointxx:ij:
For
ij
Tot==tt++ee
Tot
Thatis:
is:
That
TotalDeviation
Deviation==Treatment
TreatmentDeviation
Deviation++Error
ErrorDeviation
Deviation
Total

Consider data point x24=13 from table 9-1. The

mean of sample 2 is 11.5, and the grand mean is
6.909, so:
e24 x 24 x 2 13 11.5 1.5
t 2 x 2 x 11.5 6.909 4 .591

Tot 24 t 2 e24 1.5 4 .591 6.091

or
Tot 24 x 24 x 13 6.909 6.091

Total deviation:
Tot24=x24-x=6.091
Error deviation:
e24=x24-x2=1.5

x24=13

Treatment deviation:
t2=x2-x=4.591

x2=11.5
x = 6.909

10

The Theory and Computations of

ANOVA: Squared Deviations
Total Deviation = Treatment Deviation + Error Deviation
The total deviation is the sum of the treatment deviation and the error deviation:
t + e = ( x x ) ( x ij x ) ( x ij x ) Tot ij
i
ij
i
i
Notice that the sample mean term ( x ) cancels out in the above addition, which
i
simplifies the equation.

Squared Deviations
2

= (x x)
i
ij
i
2
2
Tot ij ( x ij x )
t

+e

( x ij x )
i

9-17

The Theory and Computations of ANOVA:

The Sum of Squares Principle
Sums of Squared Deviations
n
n
j
j
r
r
r
2
2
2

Tot
e
nt
+
i 1 j 1 ij
i 1 ii
i 1 j 1 ij
n
n
j
j
r
r
r
2
2

(x x) = n (x x)
( x x )2
i
i 1 j 1 ij
i 1 i i
i 1 j 1 ij

SST =

SSTR

SSE

TheSum
Sumof
ofSquares
SquaresPrinciple
Principle
The
Thetotal
totalsum
sumof
ofsquares
squares(SST)
(SST)isisthe
thesum
sumof
oftwo
twoterms:
terms: the
thesum
sumof
of
The
squaresfor
fortreatment
treatment(SSTR)
(SSTR)and
andthe
thesum
sumof
ofsquares
squaresfor
forerror
error(SSE).
(SSE).
squares
SST == SSTR
SSTR ++ SSE
SSE
SST

9-18

9-19

The Theory and Computations of ANOVA:

Picturing The Sum of Squares Principle
SSTR

SSE

SST
SSTmeasures
measuresthe
thetotal
totalvariation
variationininthe
thedata
dataset,
set,the
thevariation
variationof
ofall
allindividual
individualdata
data
SST
pointsfrom
fromthe
thegrand
grandmean.
mean.
points
SSTRmeasures
measuresthe
theexplained
explainedvariation,
variation,the
thevariation
variationof
ofindividual
individualsample
samplemeans
means
SSTR
fromthe
thegrand
grandmean.
mean. ItItisisthat
thatpart
partofofthe
thevariation
variationthat
thatisispossibly
possiblyexpected,
expected,oror
from
explained,because
becausethe
thedata
datapoints
pointsare
aredrawn
drawnfrom
fromdifferent
differentpopulations.
populations. Its
Itsthe
the
explained,
variationbetween
betweengroups
groupsofofdata
datapoints.
points.
variation
SSEmeasures
measuresunexplained
unexplainedvariation,
variation,the
thevariation
variationwithin
withineach
eachgroup
groupthat
thatcannot
cannotbe
be
SSE
explainedby
bypossible
possibledifferences
differencesbetween
betweenthe
thegroups.
groups.
explained

The Theory and Computations of

ANOVA: Degrees of Freedom
Thenumber
numberofofdegrees
degreesofoffreedom
freedomassociated
associatedwith
withSST
SSTisis(n
(n--1).
1).
The
totalobservations
observationsininall
allrrgroups,
groups,less
lessone
onedegree
degreeof
offreedom
freedom
nntotal
lostwith
withthe
thecalculation
calculationof
ofthe
thegrand
grandmean
mean
lost
Thenumber
numberofofdegrees
degreesofoffreedom
freedomassociated
associatedwith
withSSTR
SSTRisis(r(r--1).
1).
The
samplemeans,
means,less
lessone
onedegree
degreeof
offreedom
freedomlost
lostwith
withthe
the
rrsample
calculationofofthe
thegrand
grandmean
mean
calculation
Thenumber
numberofofdegrees
degreesofoffreedom
freedomassociated
associatedwith
withSSE
SSEisis(n-r).
(n-r).
The
totalobservations
observationsininall
allgroups,
groups,less
lessone
onedegree
degreeofoffreedom
freedom
nntotal
lostwith
withthe
thecalculation
calculationof
ofthe
thesample
samplemean
meanfrom
fromeach
eachof
ofrrgroups
groups
lost
Thedegrees
degreesofoffreedom
freedomare
areadditive
additiveininthe
thesame
sameway
wayas
asare
arethe
thesums
sumsof
ofsquares:
squares:
The
df(total)==df(treatment)
df(treatment)++df(error)
df(error)
df(total)
(n(n--1)1) == (r(r--1)1)
++ (n(n--r)r)

9-20

The Theory and Computations of

ANOVA: The Mean Squares

9-21

Recallthat
thatthe
thecalculation
calculationofofthe
thesample
samplevariance
varianceinvolves
involvesthe
thedivision
divisionof
ofthe
thesum
sumofof
Recall
squareddeviations
deviationsfrom
fromthe
thesample
samplemean
meanby
bythe
thenumber
numberof
ofdegrees
degreesof
offreedom.
freedom. This
This
squared
principleisisapplied
appliedas
aswell
welltotofind
findthe
themean
meansquared
squareddeviations
deviationswithin
withinthe
theanalysis
analysisof
of
principle
variance.
variance.
Meansquare
squaretreatment
treatment(MSTR):
(MSTR):
Mean

SSTR
MSTR
(r 1)

Meansquare
squareerror
error(MSE):
(MSE):
Mean

SSE
MSE
(n r )

Meansquare
squaretotal
total(MST):
(MST):
Mean

SST
MST
(n 1)

(Notethat
thatthe
theadditive
additiveproperties
propertiesofofsums
sumsofofsquares
squaresdo
donot
notextend
extendtotothe
themean
mean
(Note
squares. MSTMSTR
MSTMSTR++MSE.
MSE.
squares.

9-22

The Theory and Computations of

ANOVA: The Expected Mean Squares
2
E ( MSE )
and

n
(
)
2 when the null hypothesis is true
2
i
i
E ( MSTR)
r 1
> 2 when the null hypothesis is false
where i is the mean of population i and is the combined mean of all r populations.
That is, the expected mean square error (MSE) is simply the common population variance
(remember the assumption of equal population variances), but the expected treatment sum of
squares (MSTR) is the common population variance plus a term related to the variation of the
individual population means around the grand population mean.
If the null hypothesis is true so that the population means are all equal, the second term in
the E(MSTR) formulation is zero, and E(MSTR) is equal to the common population variance.

Expected Mean Squares and the

ANOVA Principle
When the null hypothesis of ANOVA is true and all r population means are
equal, MSTR and MSE are two independent, unbiased estimators of the
common population variance 2.
Onthe
theother
otherhand,
hand,when
whenthe
thenull
nullhypothesis
hypothesisisisfalse,
false,then
thenMSTR
MSTRwill
willtend
tendtoto
On
belarger
largerthan
thanMSE.
MSE.
be
Sothe
theratio
ratioof
ofMSTR
MSTRand
andMSE
MSEcan
canbe
beused
usedas
asan
anindicator
indicatorof
ofthe
the
So
equalityor
orinequality
inequalityof
ofthe
therrpopulation
populationmeans.
means.
equality
Thisratio
ratio(MSTR/MSE)
(MSTR/MSE)will
willtend
tendto
tobe
benear
nearto
to11ififthe
thenull
nullhypothesis
hypothesisisis
This
true,and
andgreater
greaterthan
than11ififthe
thenull
nullhypothesis
hypothesisisisfalse.
false. The
TheANOVA
ANOVAtest,
test,
true,
finally,isisaatest
testof
ofwhether
whether(MSTR/MSE)
(MSTR/MSE)isisequal
equalto,
to,or
orgreater
greaterthan,
than,1.1.
finally,

9-23

The Theory and Computations of

ANOVA: The F Statistic
Under the assumptions of ANOVA, the ratio (MSTR/MSE)
possess an F distribution with (r-1) degrees of freedom for
the numerator and (n-r) degrees of freedom for the
denominator when the null hypothesis is true.
The test statistic in analysis of variance:
F( r -1,n-r )

MSTR
MSE

9-24

9-25

9-4 The ANOVA Table and Examples

Treatment (i)

(x ij -xi ) (x ij -x i )2

Value (x ij )

Triangle

-2

Triangle

-1

Triangle

Triangle

Square

10

-1.5

2.25

Square
Square
Square

2
2
2

2
3
4

11
12
13

-0.5
0.5
1.5

0.25
0.25
2.25

Circle

-1

Circle

Circle

17

73

Treatment

(x i -x)

(x i -x)

ni (x i -x)

Triangle

-0.909

0.826281

3.305124

Square

4.591

21.077281

84.309124

Circle

-4.909

124.098281

72.294843
159.909091

j
r
( x x ) 2 17
SSE
i
i 1 j 1 ij
r
2
SSTR n ( x x ) 159 .9
i 1 i i
SSTR
159 .9

79 .95
MSTR
r 1
( 3 1)
SSTR 17

2 .125
MSE
n r
8
MSTR
79 .95

37 .62 .
F
MSE
2 .125
( 2 ,8 )
Critical point ( = 0.01): 8.65
H may be rejected at the 0.01 level
0
of significance.

9-26

ANOVA Table
Source of
Variation

Sum of
Squares

Degrees of
Freedom Mean Square F Ratio

Treatment SSTR=159.9

(r-1)=2

MSTR=79.95 37.62

Error

SSE=17.0

(n-r)=8

MSE=2.125

Total

SST=176.9

(n-1)=10

MST=17.69

F Distribution for 2 and 8 Degrees of Freedom

0.7

TheANOVA
ANOVATable
Tablesummarizes
summarizesthe
the
The
ANOVAcalculations.
calculations.
ANOVA

0.6
0.5

Computed test statistic=37.62

f(F)

0.4
0.3
0.2
0.01

0.1
0.0
0

8.65

10

F(2,8)

thisinstance,
instance,since
sincethe
thetest
teststatistic
statisticisis
InInthis
greaterthan
thanthe
thecritical
criticalpoint
pointfor
foran
an=
=
greater
0.01level
levelofofsignificance,
significance,the
thenull
null
0.01
hypothesismay
maybe
berejected,
rejected,and
andwe
wemay
may
hypothesis
concludethat
thatthe
themeans
meansfor
fortriangles,
triangles,
conclude
squares,and
andcircles
circlesare
arenot
notall
allequal.
equal.
squares,

9-27

Template Output

9-28

Example 9-2: Club Med

Club Med has conducted a test to determine whether its Caribbean resorts are equally well liked by
vacationing club members. The analysis was based on a survey questionnaire (general satisfaction,
on a scale from 0 to 100) filled out by a random sample of 40 respondents from each of 5 resorts.
Resort
Guadeloupe

89

Source of
Variation

Martinique

75

Treatment

SSTR= 14208 (r-1)= 4

MSTR= 3552

Eleuthra

73

Error

SSE=98356

(n-r)= 195

MSE= 504.39

Paradise Island

91

Total

SST=112564

(n-1)= 199

MST= 565.65

St. Lucia

85
SSE=98356

Sum of
Squares

Degrees of
Freedom

Mean Square

F Ratio
7.04

F Distribution with 4 and 200 Degrees of Freedom

0.7
0.6
0.5

Computed test statistic=7.04

0.4

f(F)

SST=112564

Mean Response (x i )

0.3
0.2
0.01

0.1
0.0
0

3.41

F(4,200)

Theresultant
resultantFF
The
ratioisislarger
largerthan
than
ratio
thecritical
criticalpoint
pointfor
for
the
=0.01,
0.01,so
sothe
the
=
nullhypothesis
hypothesismay
may
null
berejected.
rejected.
be

9-29

Example 9-3: Job Involvement

Source of
Variation

Sum of
Squares

Degrees of
Freedom

Mean Square

F Ratio

Treatment

SSTR= 879.3

(r-1)=3

MSTR= 293.1

8.52

Error

SSE= 18541.6

(n-r)= 539

MSE=34.4

Total

SST= 19420.9

(n-1)=542

MST= 35.83

Giventhe
thetotal
totalnumber
numberof
ofobservations
observations(n
(n==543),
543),the
thenumber
numberof
ofgroups
groups
Given
4),the
theMSE
MSE(34.
(34.4),
4),and
andthe
theFFratio
ratio(8.52),
(8.52),the
theremainder
remainderof
ofthe
theANOVA
ANOVA
(r(r==4),
tablecan
canbe
becompleted.
completed. The
Thecritical
criticalpoint
pointof
ofthe
theFFdistribution
distributionfor
for=
=0.01
0.01
table
and(3,
(3,400)
400)degrees
degreesof
offreedom
freedomisis3.83.
3.83. The
Thetest
teststatistic
statisticininthis
thisexample
exampleisis
and
muchlarger
largerthan
thanthis
thiscritical
criticalpoint,
point,so
sothe
theppvalue
valueassociated
associatedwith
withthis
thistest
test
much
statisticisisless
lessthan
than0.01,
0.01,and
andthe
thenull
nullhypothesis
hypothesismay
maybe
berejected.
rejected.
statistic

9-30

9-5 Further Analysis

Data

Do Not Reject H0
ANOVA

Stop

Reject H0

The sample means are unbiased estimators of the population means.

The mean square error (MSE) is an unbiased estimator of the common
population variance.

Further
Analysis

The ANOVA Diagram

Confidence Intervals
for Population Means
Tukey Pairwise
Comparisons Test

Confidence Intervals for Population

Means
A (1 - ) 100% confidence interval for i , the mean of population i:
MSE
xi t
ni
2
where t is the value of the t distribution with (n - r ) degrees of
2

freedom that cuts off a right - tailed area of .

2
Resort

Mean Response (x i )

Guadeloupe

89

Martinique

75

Eleuthra

73

Paradise Island

91

St. Lucia

85

SST = 112564

SSE = 98356

ni = 40

n = (5)(40) = 200

MSE = 504.39

MSE
504.39
xi 1.96
xi 6.96
ni
40
2
89 6.96 [82.04, 95.96]
75 6.96 [ 68.04,81.96]
73 6.96 [ 66.04, 79.96]
91 6.96 [84.04,97.96]
85 6.96 [ 78.04, 91.96]
xi t

9-31

9-32

The Tukey Pairwise-Comparisons Test

The Tukey Pairwise Comparison test, or Honestly Significant Differences (MSD) test, allows us to
compare every pair of population means with a single level of significance.
It is based on the studentized range distribution, q, with r and (n-r) degrees of freedom.
The critical point in a Tukey Pairwise Comparisons test is the Tukey Criterion:

T q

MSE
ni

where ni is the smallest of the r sample sizes.

The test statistic is the absolute value of the difference between the appropriate sample means, and
the null hypothesis is rejected if the test statistic is greater than the critical point of the Tukey
Criterion
Note that there are

r!

pairs of population means to compare. For example, if r =

2 !( r 2 ) !
H 0 : 1 2
H 0 : 1 3
H0 : 2 3
H1 : 1 2
H1 : 1 3
H1 : 2 3
2

3:

9-33

The Tukey Pairwise Comparison Test:

The Club Med Example
Thetest
teststatistic
statisticfor
foreach
eachpairwise
pairwisetest
testisisthe
theabsolute
absolutedifference
differencebetween
betweenthe
theappropriate
appropriate
The
samplemeans.
means.
sample
Resort
Mean
VI. HH:0:24
ii
Resort
Mean
I.I. HH0:0:1 12 2
VI.
0
2
4
1
Guadeloupe
89
H
:

H
:

1
Guadeloupe
89
H1:1 1 1 2 2
H1:1 2 2 4 4
Martinique
75
|89-75|=14>13.7*
|75-91|=16>13.7*
22
Martinique
75
|89-75|=14>13.7*
|75-91|=16>13.7*
Eleuthra
73
II. HH:0:13
VII. HH:0:25
33
Eleuthra
73
II.
VII.
0
1
3
0
2
5
4
Paradise
Is.
91
H
:

H
:

4
Paradise Is.
91
H1:1 1 1 3 3
H1:1 2 2 5 5
St.Lucia
Lucia
85
|89-73|=16>13.7*
|75-85|=10<13.7
55
St.
85
|89-73|=16>13.7*
|75-85|=10<13.7
III. HH:0:14
VIII.HH:0:34
III.
VIII.
0
1
4
0
3
4
The
critical
point
T
for
H
:

H
:

0.05for
The critical point T0.05
H1:1 1 1 4 4
H1:1 3 3 4 4
r=5and
and(n-r)=195
(n-r)=195
|89-91|=2<13.7
|73-91|=18>13.7*
r=5
|89-91|=2<13.7
|73-91|=18>13.7*
degreesofoffreedom
freedomis:
is:
IV. HH:0:15
IX. HH:0:35
degrees
IV.
IX.
0
1
5
0
3
5
MSE
H
:

H
:

T q
H1:1 1 1 5 5
H1:1 3 3 5 5
ni
|89-85|=4<13.7
|73-85|=12<13.7
|89-85|=4<13.7
|73-85|=12<13.7
504.4
V. HH:0:23
X. HH:0:45
V.
X.
0
2
3
0
4
5
3.86
13.7
H
:

H
:

40
H1:1 2 2 3 3
H1:1 4 4 5 5
|75-73|=2<13.7
|91-85|=6<13.7
6<13.7
|75-73|=2<13.7
|91-85|=
Rejectthe
thenull
nullhypothesis
hypothesisififthe
theabsolute
absolutevalue
valueofofthe
thedifference
differencebetween
betweenthe
thesample
samplemeans
means
Reject
greaterthan
thanthe
thecritical
criticalvalue
valueofofT.
T.(The
(Thehypotheses
hypothesesmarked
markedwith
with**are
arerejected.)
rejected.)
isisgreater

9-34

Picturing the Results of a Tukey Pairwise

Comparisons Test: The Club Med Example
Werejected
rejectedthe
thenull
nullhypothesis
hypothesiswhich
whichcompared
comparedthe
themeans
meansof
ofpopulations
populations11
We
and2,2,11and
and3,3,22and
and4,4,and
and33and
and4.4. On
Onthe
theother
otherhand,
hand,we
weaccepted
acceptedthe
the
and
nullhypotheses
hypothesesof
ofthe
theequality
equalityof
ofthe
themeans
meansof
ofpopulations
populations11and
and4,4,11and
and5,5,
null
and3,3,22and
and5,5,33and
and5,5,and
and44and
and5.5.
22and
3
2
5
1
4

Thebars
barsindicate
indicatethe
thethree
threegroupings
groupingsof
ofpopulations
populationswith
withpossibly
possiblyequal
equal
The
means:22and
and3;3;2,2,3,3,and
and5;5;and
and1,1,4,4,and
and5.5.
means:

9-35

Picturing the Results of a Tukey Pairwise

Comparisons Test: The Club Med Example

9-36

9-6 Models, Factors and Designs

statisticalmodel
modelisisaaset
setof
ofequations
equationsand
andassumptions
assumptions
AAstatistical
thatcapture
capturethe
theessential
essentialcharacteristics
characteristicsof
ofaareal-world
real-world
that
situation
situation
Theone-factor
one-factorANOVA
ANOVAmodel:
model:
The
=++i+
i+ijij=
i+ijij
xxijij==i+
whereijijisisthe
theerror
errorassociated
associatedwith
withthe
thejth
jthmember
memberof
of
where
theith
ithpopulation.
population. The
Theerrors
errorsare
areassumed
assumedto
tobe
be
the
normallydistributed
distributedwith
withmean
mean00and
andvariance
variance22..
normally

9-37

9-6 Models, Factors and Designs

(Continued)

factorisisaaset
setof
ofpopulations
populationsor
ortreatments
treatmentsof
ofaasingle
singlekind.
kind. For
For
AAfactor
example:
example:
Onefactor
factormodels
modelsbased
basedon
onsets
setsof
ofresorts,
resorts,types
typesof
ofairplanes,
airplanes,or
or
One
kindsof
ofsweaters
sweaters
kinds
Twofactor
factormodels
modelsbased
basedon
onfirm
firmand
andlocation
location
Two
Threefactor
factormodels
modelsbased
basedon
oncolor
colorand
andshape
shapeand
andsize
sizeof
ofan
anad.
ad.
Three
Fixed-Effectsand
andRandom
RandomEffects
Effects
Fixed-Effects
Afixed-effects
fixed-effectsmodel
modelisisone
oneininwhich
whichthe
thelevels
levelsof
ofthe
thefactor
factorunder
under
A
study(the
(thetreatments)
treatments)are
arefixed
fixedininadvance.
advance. Inference
Inferenceisisvalid
validonly
only
study
forthe
thelevels
levelsunder
understudy.
study.
for
Arandom-effects
random-effectsmodel
modelisisone
oneininwhich
whichthe
thelevels
levelsof
ofthe
thefactor
factor
A
understudy
studyare
arerandomly
randomlychosen
chosenfrom
froman
anentire
entirepopulation
populationof
oflevels
levels
under
(treatments). Inference
Inferenceisisvalid
validfor
forthe
theentire
entirepopulation
populationof
oflevels.
levels.
(treatments).

9-38

Experimental Design
completely-randomizeddesign
designisisone
onein
inwhich
whichthe
the
AAcompletely-randomized
elementsare
areassigned
assignedto
totreatments
treatmentscompletely
completelyat
atrandom.
random.
elements
Thatis,
is,any
anyelement
elementchosen
chosenfor
forthe
thestudy
studyhas
hasan
anequal
equal
That
chanceof
ofbeing
beingassigned
assignedto
toany
anytreatment.
treatment.
chance
Inaablocking
blockingdesign,
design,elements
elementsare
areassigned
assignedto
totreatments
treatments
In
afterfirst
firstbeing
beingcollected
collectedinto
intohomogeneous
homogeneousgroups.
groups.
after

Inaacompletely
completelyrandomized
randomizedblock
blockdesign,
design,all
allmembers
membersof
ofeach
each
In

block(homogeneous
(homogeneousgroup)
group)are
arerandomly
randomlyassigned
assignedtotothe
thetreatment
treatment
block
levels.
levels.
Inaarepeated
repeatedmeasures
measuresdesign,
design,each
eachmember
memberof
ofeach
eachblock
blockisis
In
assignedtotoall
alltreatment
treatmentlevels.
levels.
assigned

9-39

9-7 Two-Way Analysis of Variance

two-wayANOVA,
ANOVA,the
theeffects
effectsof
oftwo
twofactors
factorsorortreatments
treatmentscan
canbe
beinvestigated
investigated
InInaatwo-way
simultaneously. Two-way
Two-wayANOVA
ANOVAalso
alsopermits
permitsthe
theinvestigation
investigationofofthe
theeffects
effectsofof
simultaneously.
eitherfactor
factoralone
aloneand
andof
ofthe
thetwo
twofactors
factorstogether.
together.
either

The effect on the population mean that can be attributed to the levels of either factor alone
The
effect on the population mean that can be attributed to the levels of either factor alone

calledaamain
maineffect.
effect.
isiscalled
An interaction effect between two factors occurs if the total effect at some pair of levels of
An
interaction effect between two factors occurs if the total effect at some pair of levels of
the
twofactors
factorsorortreatments
treatmentsdiffers
differssignificantly
significantlyfrom
fromthe
thesimple
simpleaddition
additionofofthe
thetwo
twomain
main
the two
effects. Factors
Factorsthat
thatdo
donot
notinteract
interactare
arecalled
calledadditive.
additive.
effects.

Threequestions
questionsanswerable
answerableby
bytwo-way
two-wayANOVA:
ANOVA:
Three

Forexample,
example, we
wemight
mightinvestigate
investigatethe
theeffects
effectson
onvacationers
vacationersratings
ratingsof
ofresorts
resortsby
by
For
lookingatatfive
fivedifferent
differentresorts
resorts(factor
(factorA)
A)and
andfour
fourdifferent
differentresort
resortattributes
attributes(factor
(factor
looking
B). InInaddition
additiontotothe
thefive
fivemain
mainfactor
factorAAtreatment
treatmentlevels
levelsand
andthe
thefour
fourmain
mainfactor
factorBB
B).
treatmentlevels,
levels,there
thereare
are(5*4=20)
(5*4=20)interaction
interactiontreatment
treatmentlevels.3
levels.3
treatment

Are there any factor A main effects?

Are
there any factor A main effects?
Are there any factor B main effects?
Are there any factor B main effects?
Are there any interaction effects between factors A and B?
Are
there any interaction effects between factors A and B?

9-40

The Two-Way ANOVA Model

=++i+
jj ++ ((
ijij ++ ijkijk
xxijk
ijk=
i+
whereisisthe
theoverall
overallmean;
mean;
where

theeffect
effectof
oflevel
leveli(i=1,...,a)
i(i=1,...,a)of
offactor
factorA;
A;
i iisisthe
isthe
theeffect
effectof
oflevel
levelj(j=1,...,b)
j(j=1,...,b)of
offactor
factorB;
B;
j jis

jjjjisisthe
theinteraction
interactioneffect
effectof
oflevels
levelsiiand
andj;j;

isthe
theerror
errorassociated
associatedwith
withthe
thekth
kthdata
datapoint
pointfrom
from
jjk
jjkis
leveliiof
offactor
factorAAand
andlevel
leveljjof
offactor
factorB.
B.
level
isassumed
assumedto
tobe
bedistributed
distributednormally
normallywith
withmean
meanzero
zero
jjk
jjkis
andvariance
variance22for
forall
alli,i,j,j,and
andk.k.
and

9-41

Two-Way ANOVA Data Layout:

Club Med Example
Factor B:
Attribute

Factor A: Resort
Friendship
Sports
Culture
Excitement

Guadeloupe
n11
n12
n13
n14

Martinique
n21
n22
n23
n24

Graphical Display of Effects

Eleuthra
n31
n32
n33
n34

Rating

Friendship

R a ting

Excitement
Sports
Culture

Friendship

Paradise
Island
n41
n42
n43
n44

St. Lucia
n51
n52
n53
n54

Eleuthra/sports interaction:
Combined effect greater than
additive main effects
Attribute

Excitement
Sports
Culture

Eleuthra
St. Lucia
Paradise island
Martinique
Guadeloupe
Resort

Resort
St. Lucia
Paradise Island
Eleuthra
Guadeloupe
Martinique

9-42

Hypothesis Tests a Two-Way ANOVA

Factor AAmain
main effects
effects test
test::
Factor
H0: i= 0 for all i=1,2,...,a

H0: i= 0 for all i=1,2,...,a

H1: Not all i are 0

H1: Not all i are 0

Factor BB main
main effects
effects test:
test:
Factor
H0: j= 0 for all j=1,2,...,b

H0: j= 0 for all j=1,2,...,b

H1: Not all i are 0

H1: Not all i are 0

Test for
for (AB)
(AB) interactions:
interactions:
Test

H0: ij= 0 for all i=1,2,...,a and j=1,2,...,b

H0: ij= 0 for all i=1,2,...,a and j=1,2,...,b

H1: Not all ij are 0

H1: Not all ij are 0

9-43

Sums of Squares
In a two-way ANOVA:

In a two-way ANOVA:

=+i+
j j ++(
(ijkijk ++ijkijk
i+
xxijkijk=+
SST==SSTR
SSTR+SSE
+SSE
SST
SST==SSA
SSA++SSB
SSB+SS(AB)+SSE
+SS(AB)+SSE
SST
SST SSTR SSE
( x x )2 ( x x )2 ( x x )2
SSTR SSA SSB SS ( AB)
( x x )2 ( x x )2 ( x x x x )2
i
j
ij i
j

9-44

The Two-Way ANOVA Table

Source of
Variation

Sum of
Squares

Degrees
of Freedom

Mean Square

F Ratio

Factor A

SSA

a-1

MSA

SSA
a 1

MSA
F
MSE

Factor B

SSB

b-1

MSB

SSB
b 1

MSB
F
MSE

Interaction SS(AB)

(a-1)(b-1)

MS ( AB)

Error

SSE

ab(n-1)

Total

SST

abn-1

A Main Effect Test: F(a-1,ab(n-1))

SS ( AB)
( a 1)(b 1)
SSE
MSE
ab( n 1)

MS ( AB)
F
MSE

B Main Effect Test: F(b-1,ab(n-1))

(AB) Interaction Effect Test: F((a-1)(b-1),ab(n-1))

9-45

Example 9-4: Two-Way ANOVA

(Location and Artist)
Source of
Variation

Sum of
Squares

Degrees
of Freedom

Location

1824

912

8.94

Artist

2230

1115

10.93

804

201

1.97

Error

8262

81

102

Total

13120

89

Interaction

Mean Square

F Ratio

=0.01,FF(2,81)=4.88
=4.88
Both
Bothmain
maineffect
effectnull
nullhypotheses
hypothesesare
arerejected.
rejected.
=0.01,
(2,81)
=0.05,FF(2,81)=2.48
=2.48
Interaction
Interactioneffect
effectnull
nullhypotheses
hypothesesare
arenot
notrejected.
rejected.
=0.05,
(2,81)

9-46

Hypothesis Tests
F Distribution with 2 and 81 Degrees of Freedom

F Distribution with 4 and 81 Degrees of Freedom

0.7

0.7

Location test statistic=8.94

Artist test statistic=10.93

0.6

0.4

Interaction test statistic=1.97

0.5

f(F)

f(F)

0.5

0.6

0.4
0.3

0.3

=0.01

0.2

=0.05

0.2
0.1

0.1
0.0
0

F0.01=4.88

0.0
0

F0.05=2.48

Overall Significance Level and Tukey

Method for Two-Way ANOVA
KimballsInequality
Inequalitygives
givesan
anupper
upperlimit
limiton
onthe
thetrue
trueprobability
probabilityof
ofatatleast
least
Kimballs
one Type
TypeIIerror
errorininthe
thethree
threetests
testsof
ofaatwo-way
two-wayanalysis:
analysis:
one
1-(1-
(1-)1)(1-
(1-)2)(1-
(1-)3)
11
2
3
TukeyCriterion
Criterionfor
forfactor
factorA:
A:
Tukey

T q

MSE
bn

wherethe
thedegrees
degreesof
offreedom
freedomof
ofthe
theqqdistribution
distributionare
arenow
nowaaand
andab(n-1).
ab(n-1).
where
Notethat
thatMSE
MSEisisdivided
dividedby
bybn.
bn.
Note

9-47

9-48

Template for a Two-Way ANOVA

9-49

Extension of ANOVA to Three Factors

Source of
Variation

Sum of
Squares

Degrees
of Freedom

Mean Square
SSA
a 1

Factor A

SSA

a-1

MSA

Factor B

SSB

b-1

SSB
MSB
b 1

Factor C

SSC

c-1

MSC

Interaction
(AB)
Interaction
(AC)
Interaction
(BC)

SS(AB)

(a-1)(b-1)

SS(AC)

(a-1)(c-1)

SS(BC)

(b-1)(c-1)

SS ( AB)
( a 1)(b 1)
SS ( AC)
MS ( AC)
(a 1)(c 1)
SS ( BC)
MS ( BC)
(b 1)(c 1)

Interaction
(ABC)
Error

SS(ABC)

(a-1)(b-1)(c-1)

SSE

abc(n-1)

Total

SST

abcn-1

SSC
c 1

MS ( AB)

SS ( ABC)
(a 1)(b 1)(c 1)
SSE
MSE
abc( n 1)

MS ( ABC)

F Ratio

MSA
F
MSE
F

MSB
MSE

MSC
MSE
MS ( AB )
F
MSE
F

MS ( AC )
F
MSE
MS ( BC)
F
MSE
MS( ABC)
F
MSE

Two-Way ANOVA with One

Observation per Cell

The case of one data point in every cell presents a

problem in two-way ANOVA.
There will be no degrees of freedom for the error term.
What can be done?
If we can assume that there are no interactions between
the main effects, then we can use SS(AB) and its
associated degrees of freedom (a 1)(b 1) in place of
SSE and its degrees of freedom.
We can then conduct main effects tests using MS(AB).
See the next slide for the ANOVA table.

9-50

9-51

Two-Way ANOVA with One

Observation per Cell
Source of
Variation

Sum of
Squares

Degrees of
Freedom

Factor A

SSA

a-1

Factor B

SSB

b-1

Error

SS(AB)

(a 1)(b
1)

Total

SST

ab - 1

Mean Square

F Ratio

MSA SSA
a 1

F MSA
MS (AB)

MSB SSB
b 1

F MSB
MS (AB)

MS ( AB) SS ( AB)
(a 1)(b 1)

9-52

9-8 Blocking Designs

A block is a homogeneous set of subjects, grouped to

minimize within-group differences.
A competely-randomized design is one in which the
elements are assigned to treatments completely at
random. That is, any element chosen for the study has an
equal chance of being assigned to any treatment.
In a blocking design, elements are assigned to treatments
after first being collected into homogeneous groups.
In a completely randomized block design, all members of each
block (homogenous group) are randomly assigned to the
treatment levels.
In a repeated measures design, each member of each block is
assigned to all treatment levels.

Model for Randomized Complete

Block Design
=+
+i+
jj ++ ijij
xxijij=
i+

where is the overall mean;

where is the overall mean;

i is the effect of level i(i=1,...,a) of factor A;

i is the effect of level i(i=1,...,a) of factor A;

j is the effect of block j(j=1,...,b);

j is the effect of block j(j=1,...,b);

is the error associated with

ij is the error associated with

ij

xxijij

ij is assumed to be distributed normally with

ij is assumed to be distributed normally with

mean zero
zero and
and variance
variance 22 for
for all
all ii and
and j.j.
mean

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ANOVA Table for Blocking Designs:

Example 9-5
Source of Variation Sum of Squares Degress of Freedom Mean Square
Blocks
Treatments
Error
Total

SSBL
SSTR
SSE
SST

Source of Variation
Blocks
Treatments
Error
Total

n-1
r-1
(n -1)(r - 1)
nr - 1

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F Ratio

MSBL = SSBL/(n-1) F = MSBL/MSE

MSTR = SSTR/(r-1) F = MSTR/MSE
MSE = SSE/(n-1)(r-1)

Sum of Squares
df
Mean Square F Ratio
2750
39
70.51
0.69
2640
2
1320
12.93
7960
78
102.05
13350 119

= 0.01, F(2, 78) = 4.88

Template for the Randomized

Complete Block Design

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