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Q1.
Explain the difference between parametric and non-
parametric tests. Give a summary of tests – parametric and non-parametric along with the appropriate situation where they may be used. Ans. The parametric test is the hypothesis test which provides generalisations for making statements about the mean of the parent population. A t-test based on Student’s t-statistic, which is often used in this regard. The t-statistic rests on the underlying assumption that there is the normal distribution of variable and the mean in known or assumed to be known. The population variance is calculated for the sample. It is assumed that the variables of interest, in the population are measured on an interval scale. Whereas, the nonparametric test is defined as the hypothesis test which is population’s distribution to be denoted by specific parameters. The test is mainly based on differences in medians. Hence, it is alternately known as the distribution-free test. The test assumes that the variables are measured on a nominal or ordinal level. It is used when the independent variables are non-metric.
The fundamental differences between parametric and
nonparametric test are discussed in the following points:
1. A statistical test, in which specific assumptions are made
about the population parameter is known as the parametric test. A statistical test used in the case of non- metric independent variables is called a nonparametric test. 2. In the parametric test, the test statistic is based on distribution. On the other hand, the test statistic is arbitrary in the case of the nonparametric test. 3. In the parametric test, it is assumed that the measurement of variables of interest is done on interval or ratio level. As opposed to the nonparametric test, wherein the variables of interest are measured on nominal or ordinal scale. 4. In general, the measure of central tendency in the parametric test is mean, while in the case of the nonparametric test is median. 5. In the parametric test, there is complete information about the population. Conversely, in the nonparametric test, there is no information about the population. 6. The applicability of parametric test is for variables only, whereas nonparametric test applies to both variables and attributes. 7. For measuring the degree of association between two quantitative variables, Pearson’s coefficient of correlation is used in the parametric test, while spearman’s rank correlation is used in the nonparametric test.
● Parametric tests are used only where a normal
distribution is assumed. The most widely used tests are the t-test (paired or unpaired), ANOVA (one-way non-repeated, repeated; two-way, three-way), linear regression and Pearson rank correlation. The situations for example testing new virus spread specific area and when we observe the area with another we see area 1 is less virulent than area 2, then scientist wants to compare the recovery rate of both areas, he can use one of the parametric test T- test or ANOVA and compare mean between two and find differences.
● Non-parametric tests are used when continuous data
are not normally distributed or when dealing with discrete variables. Most widely used are chi- squared, Fisher's exact tests, Wilcoxon's matched pairs, Mann–Whitney U-tests, Kruskal–Wallis tests and Spearman rank correlation.
We can take examples of tests on whether customers
prefer quantity of a product with less price or good quality with high price, by using rating scale and get highly rated result. In such scenario we can use non parametric tests
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