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PARAMETRIC V/S NON-PARAMETRIC TESTS
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Parametric Vs Non-parametric Tests
Parametric Tests: ⚫ The population mean (μ), standard deviation (σ) and proportion (p) are called the parameters of a distribution. ⚫ Tests of hypotheses concerning the mean and proportion are based on the assumption that the population(s) from where the sample is drawn is normally distributed. ⚫ Tests based on the above parameters are called parametric tests. Parametric Vs. Non-parametric Tests Non-Parametric Tests:- ⚫ There are situations where the populations under study are not normally distributed. The data collected from these populations is extremely skewed. Therefore, the parametric tests are not valid. ⚫ The option is to use a non-parametric test. These tests are called the distribution-free tests as they do not require any assumption regarding the shape of the population distribution from where the sample is drawn. ⚫ These tests could also be used for the small sample sizes where the normality assumption does not hold true. Advantages of Non-Parametric Tests ⚫ They can be applied to many situations as they do not have the rigid requirements of their parametric counterparts, like the sample having been drawn from the population following a normal distribution. ⚫ There can be applications where a numeric observation is difficult to obtain but a rank value is not. By using ranks, it is possible to relax the assumptions regarding the underlying populations. ⚫ Non-parametric tests can often be applied to the nominal and ordinal data that lack exact or comparable numerical values. ⚫ Non-parametric tests involve very simple computations compared to the corresponding parametric tests. Disadvantages of Non-Parametric Tests ⚫ A lot of information is wasted because the exact numerical data is reduced to a qualitative form. The increase or the gain is denoted by a plus sign whereas a decrease or loss is denoted by a negative sign. No consideration is given to the quantity of the gain or loss. ⚫ Non-parametric methods are less powerful than parametric tests when the basic assumptions of parametric tests are valid. ⚫ Null hypothesis in a non-parametric test is loosely defined as compared to the parametric tests. Therefore, whenever the null hypothesis is rejected, a non-parametric test yields a less precise conclusion as compared to the parametric test. Difference between Parametric & Non- parametric Tests END OF CHAPTER