# Understanding Anova in Excel

## How to Perform Analyses of Variance in Excel

This example teaches you how to perform a single factor **ANOVA** (analysis of variance) in **Excel**. A single factor or one-way ANOVA is used to test the null hypothesis that the means of several populations are all equal.

Below you can find the salaries of people who have a degree in economics, medicine or history.

H_{0}: μ_{1} = μ_{2} = μ_{3}

H_{1}: at least one of the means is different.

To perform a single factor **ANOVA**, execute the following steps.

1. On the Data tab, in the Analysis group, Data Analysis.

Note: can’t find the Data Analysis button? Click here to load the Analysis ToolPak add-in.

2. Select Anova: Single Factor and click OK.

3. Click in the Input Range box and select the range A2:C10.

4. Click in the Output Range box and select cell E1.

5. Click OK.

Result:

Conclusion: if F > F crit, we reject the null hypothesis. This is the case, 15.196 > 3.443. Therefore, we reject the null hypothesis. The means of the three populations are not all equal. At least one of the means is different. However, the **ANOVA** does not tell you where the difference lies. You need a t-Test to test each pair of means.