In this Lesson, we learned how to calculate counts under the assumption that the two categorical variables are independent. We then used these expected counts to test the hypotheses:
- \(H_0\colon\) The two variables are independent.
- \(H_a\colon\) The two variables are not independent.
We demonstrated how this test relates to our test for two proportions when the alternative is two-sided.
We also introduced the terms risk and relative risk. The calculation, as well as the interpretation, is discussed.
In the next Lesson, we will consider the case where there are two quantitative variables (quantitative response and quantitative explanatory variable). We will explore how to determine if the variables have a significant linear relationship.