# What is statistical significance?

##### 1 Answer

Nov 5, 2015

Statistical significance or the level of significance is a factor in deriving a test procedure.

#### Explanation:

The level of significance is generally taken as 5%. In some case, it can be 1% or 10% or 2%.

Here, let me explain the meaning of 5% level of significance.

By the property of a normal variate, we know that

Pr[#mu# - 3#sigma# < x <#mu# + 3#sigma# ] is approximately .95

In other words, it is expected that in only 5% cases, the value of the random variable is expected to be outside the range mentioned above.

Hence, a null hypothesis rejected by a statistical test procedure, we say that the difference is statistically significant.