Cross Tabulation - Pearson’s Chi-Square Test

Chi-Square Test is used to see if there is an association between the categorical variables or not. We formulate two hypothesis.

Null Hypothesis: There is no significant relationship between variables.

Alternative Hypothesis: There is a significant relationship between variables.

Chi-Square calculation is done using the above formula O - Observed Frequency E - Expected Frequency

Significance Levels α = 0.01, α = 0.05, α = 0.10

Chi-Square Critical value is obtained from Chi -table using Degree of freedom and Significance level α.

If the chi calculated > chi critical or p-value < 0.05 (decided significance level), we Reject the Null Hypothesis. We state there exist significant relationship between the variables.

In the above example the Chi Calculated value is less than the Chi Critical

Hence we accept the Null hypothesis and state that there is no significant relationship between 2 variables(Gender and credit cards owned).