we try to find the values of the parameters that would have most likely produced the data we in fact observed.
to find the set of value of the unknown parameter that make likelihood (L) as large as possible.
Under the null hypothesis, the Vuong’s statistic is asymptotically normally distributed. At 5 % significance level, the first model is preferred if V[1.96; If V-1.96, then the second one is preferred and the two models are equivalent when |V|1.96.
The mean of the distribution is equal to μ .
The variance is also equal to μ .
x is the actual number of successes that result from the experiment