Course Content
Data Collection & Questionnaire Design
Data Collection & Questionnaire Design
Sampling: Concept, Process, and Techniques
Sampling: Concept, Process, and Techniques
0/2
Hypothesis Testing: Procedure
Hypothesis Testing: Procedure
0/2
Operations Management: Role and Scope
Operations Management: Role and Scope
0/3
Facility Location and Layout: Site Selection and Analysis, Layout Design and Process
Facility Location and Layout: Site Selection and Analysis, Layout Design and Process
Facility Location and Layout
Site Selection and Analysis, Layout Design and Process
0/3
Enterprise Resource Planning: ERP Modules, ERP Implementation
Enterprise Resource Planning: ERP Modules, ERP Implementation
Scheduling: Loading, Sequencing, and Monitoring
Scheduling: Loading, Sequencing, and Monitoring
0/6
Quality Management and Statistical Quality Control, Quality Circles, Total Quality Management – KAIZEN, Benchmarking, Six Sigma
Quality Management and Statistical Quality Control, Quality Circles, Total Quality Management – KAIZEN, Benchmarking, Six Sigma
0/5
ISO 9000 Series Standards
ISO 9000 Series Standards
Unit VIII: Business Statistics and Operations Management

Valid Application:

 

  • If there are only two cells, expected frequency in each cell should be 5 or more
    This is a valid condition for applying χ², not a restriction.

  • Samples of at least 50 observations must be drawn randomly from the population
    Random sampling and adequate sample size are requirements, not conditions for non-application.

  • Data should be expressed in original units rather than ratio or percentage
    Chi-square is applied to frequency data, not ratios or percentages—this is again a valid condition.


One of the key limitations/conditions for applying the χ² (chi-square) test is related to expected frequencies:

  • When the number of cells is more than two, not more than 20% of the cells should have expected frequencies less than 5.

  • If more than 20% of the cells have expected frequencies below 5, the chi-square test should NOT be applied, as the approximation becomes unreliable.

Hence, this condition represents a situation where χ² should not be used.