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# Week 2 exercise 2 1

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Exercise #2:
Use the dataset from week1 exercise and then answer the following questions:
1) Compare the following information between teaching and non-teaching
hospitals.
Teaching hospitals = 936; Non-teaching hospitals=2094.
2) What are the main significant differences between teaching and non-teaching
hospitals? (use ttest)
Based on the t-tests results, there are significant differences between teaching and non-
teaching hospitals in terms of all the hospital characteristics, except number of non-paid
employees.
1. Number of beds and other significant variables
H
1
: There is no significant difference between number of beds in teaching and non-teaching
hospitals
Ha: There is significant difference between number of beds in teaching and non-teaching
hospitals
Since p-value for number of beds is 0.0000< 0.05, the null hypothesis is rejected, leading to a
conclusion that there is significant difference between number of beds in teaching and non-
teaching hospitals. The p-value also implies that number of beds is statistically significant. The
same applies to other hospital characteristics such as number of paid employees, internes and
residents, systems membership, total hospital cost, hospital revenues, hospital net benefits,
available Medicare days, available Medicaid days, and total hospital discharge with p-values
0.0000 (statistically significant) see table 2.
2. Number of non-paid employees
H
1
: There is no significant difference between number of non-paid employees in teaching and
non-teaching hospitals
Ha: There is significant difference between number of non-paid employees in teaching and non-
teaching hospitals
Since p-value for number of non-paid employees is 0.1424> 0.05, the null hypothesis is
accepted, leading to a conclusion that there is no significant difference between number of non-
paid employees in teaching and non-teaching hospitals. The p-value also implies that the number
of non-paid employees is statistically insignificant.
3) Comparing hospital net-benefit which hospitals has better performance? To
answer this question first compute the hospital net benefits with subtracting
hospital costs and revenues and then use ttest to compare the significant
differences between teaching and non-teaching hospitals.

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Teaching hospitals performed better than non-teaching hospitals. Teaching hospitals recorded an
average net benefit of \$24522161.4615 (S.D.= 33074626.2128) compared to non-teaching
hospitals’ average net benefit of \$ 8635257.2746 (S.D.= 14121090.3869). See table 2.
Regarding t-test, the following hypothesis was formulated;
Ho: There is no significant difference between the performance of teaching and non-teaching
hospitals
Ha: There is a significant difference between the performance of teaching and non-teaching
hospitals
Using t-test, t-value = (\$24522161.4615-\$ 8635257.2746)/ sqrt {(33074626.2128^2/936) +
(14121090.3869^2/2088)} = 14.12948075, p-value = 0.0000. Since p-values is less than 0.05
(level of significance), the null hypothesis rejected, thus, there is significant difference between
teaching and non-teaching hospitals in terms of performance.
4) Use a box-plot and compare hospitals-cost and hospital-revenues between
teaching and non-teaching hospitals.

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Exercise #2: Use the dataset from week1 exercise and then answer the following questions: 1) Compare the following information between teaching and non-teaching hospitals. Teaching hospitals = 936; Non-teaching hospitals=2094. 2) What are the main significant differences between teaching and non-teaching hospitals? (use ttest) Based on the t-tests results, there are significant differences between teaching and nonteaching hospitals in terms of all the hospital characteristics, except number of non-paid employees. 1. Number of beds and other significant variables H1: There is no significant difference between number of beds in teaching and non-teaching hospitals Ha: There is significant difference between number of beds in teaching and non-teaching hospitals Since p-value for number of beds is 0.0000< 0.05, the null hypothesis is rejected, leading to a conclusion that there is significant difference between number of beds in teaching and nonteaching hospitals. The p-value also implies that number of beds is statistically significant. The same applies to other hospital characteristics such as number of paid employees, internes and residents, systems membership, total hospital cost, h ...
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