Why null hypothesis is Ho <= 40 % ?
In the example presented in video, market analyst was asked to check if email open rate of competitors is above 40%.
So according to previous lectures, null hypothesis should be the one which we test and we assume "current state" as null hypothesis.
According to this logic, null hypothesis should be Ho >= 40%.
But video says null hypothesis is Ho<= 40%. I could not understand this.
Please clarify and if possible point me to other material where I can find how to choose null and alternate hypothesis.
Thanks for reaching out!
Here, we want to estimate if the competitor has a higher rate. This basically tells you the alternative hypothesis. Usually, what you try to achieve or prove is what drives the alternative hypothesis.
If we cannot reject the null hypothesis, it means we have been wrong and the competitor has the same or lower email rate.
The 365 Team
Aren't we actually doubting that our competitors have email open rate > 40%, aren't we? So shouldn't this be H0? we want to reject this.
In the example, why would want to reject (if in general, in hypothesis testing we aim to reject Null hypothesis) email open rate <= 40%?
If I would take the above situation, I would get a false positive result.