Testing Hypotheses: One Sample Tests

A manufacturer of a vitamin supplement for newborns inserts a coupon for a free sample of its product in a package that is distributed at hospitals to new parents.

A stockbroker claims that she can predict with 85 percent accuracy whether a stock’s market value will rise or fall during the coming month. As a test, she predicts the outcome of 60 stocks and is correct in 45 of the predictions.

Do these data present conclusive evidence (at α = 0.04) that her prediction accuracy is significantly less than the asserted 85 percent?

Refer to Exercise SC 8-5. Compute the power of the test for μ = 14,000, 13,500, and 13,000.

A personnel manager believed that 18 percent of the company’s employees work overtime every week. If the observed proportion this week is 13 percent in a sample of 250 of the 2,500 employees, can we accept her belief as reasonable or must we conclude that some other value is more appropriate? Use α = 0.05

Refer to Exercise 8-26. Compute the power of the test for μ = $41.95, $42.95, and $43.95.

Approximately 65 percent of all adults in the United States are3 married is the proportion of married CEOs significance greater than that of the general population ?

The median number of children in U>S. households is 2. At a 10 percent significance level.

In Exercise 8-26, what would be the power of the test for μ = $41.95, $42.95, and $43.95 if the significance level were changed to 0.05?

Assuming that the population is approximately normally distributed, is it reasonable to conclude, at a 5 percent significance level, that the average age of the CEOS of all closely held North Carolina corporation is significant greater than 50?

Drive-a-Lemon rents cars that are mechanically sound, but older than those rented by the large national rent-a-car chains. As a result, it advertises that its rates are consider- ably lower than rates of its larger competitors. An industry survey has established that the average total charge per rental at one of the major firms is $77.38. A random sample of 18 completed transactions at Drive-a-Lemon showed an average total charge of $87.61 and a sample standard deviation of’ $19.48. Verify that at a = 0.025, Drive-a-Lemon’s average total charge is significantly higher than that of the major firms. Does this result indicate that Drive-a-Lemon’s rates,’ in fact, are not lower than the rates charged by the major national chains? Explain

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Testing Hypotheses: One Sample Tests

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