Steps in Hypothesis Testing

1. The first step in hypothesis testing is to specify the null hypothesis (H0) and the alternative hypothesis (H1).

2. The next step is to select a significance level. Typically the 0.05 or the 0.01 level is used.

3. The third step is to calculate a statistic analogous to the parameter specified by the null hypothesis.

4. The fourth step is to calculate the probability value (often called the p value).

5. The probability value computed in Step 4 is compared with the significance level chosen in Step 2.

6. If the outcome is statistically significant, then the null hypothesis is rejected in favor of the alternative hypothesis.

7. The final step is to describe the result and the statistical conclusion in an understandable way.

Source: http://davidmlane.com/hyperstat/B35642.html