What does "Z-test" mean?

Definition of Z-test in the context of A/B testing (online controlled experiments).

What is a Z-test?

A Z-Test is a statistical test which is based on the assumption of normal distribution of the parameter of interest and results in a z Score. Many classic statistical tests operate under this assumption and produce results from the standard normal Z distribution.

A Z-Test can be performed when the population standard deviation (Σ) is known, or when the sample size is large enough so that the Central Limit Theorem can be applied. This is most often the case in A/B testing where the typical key performance indicator is an average (mean) and the sample size is usually in the thousands. The CLT and thus a Z distribution can generally be applied for sample sizes above 30 with minimal loss of accuracy versus the more robust T distribution (see T-test).

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