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You are on page 1of 32

Hypothesis Testing

Learning Objectives

1. Learn how to formulate and test hypotheses about a population mean and/or a population proportion.

6. Be able to determine the size of a simple random sample necessary to keep the probability of

hypothesis testing errors within acceptable limits.

alternative hypothesis p-value

Type I error level of significance

Type II error critical value

one-tailed test power curve

9-1

Chapter 9

Solutions:

c. The managers claim can be rejected. We can conclude that > 600.

2. a. H0: 14

b. There is no statistical evidence that the new bonus plan increases sales volume.

c. The research hypothesis that > 14 is supported. We can conclude that the new bonus plan

increases the mean sales volume.

b. There is no evidence that the production line is not operating properly. Allow the production process

to continue.

c. Conclude 32 and that overfilling or underfilling exists. Shut down and adjust the production

line.

4. a. H0: 220

Ha: < 220 Research hypothesis to see if mean cost is less than $220.

c. Conclude < 220. Consider implementing the new method based on the conclusion that it lowers

the mean cost per hour.

5. a. The Type I error is rejecting H0 when it is true. This error occurs if the researcher concludes that

young men in Germany spend more than 56.2 minutes per day watching prime-time TV when the

national average for Germans is not greater than 56.2 minutes.

b. The Type II error is accepting H0 when it is false. This error occurs if the researcher concludes that

the national average for German young men is 56.2 minutes when in fact it is greater than 56.2

minutes.

Ha: > 1

b. Claiming > 1 when it is not. This is the error of rejecting the products claim when the claim is

true.

9-2

Hypothesis Testing

c. Concluding 1 when it is not. In this case, we miss the fact that the product is not meeting its

label specification.

7. a. H0: 8000

Ha: > 8000 Research hypothesis to see if the plan increases average sales.

b. Claiming > 8000 when the plan does not increase sales. A mistake could be implementing the

plan when it does not help.

c. Concluding 8000 when the plan really would increase sales. This could lead to not

implementing a plan that would increase sales.

8. a. H0: 220

b. Claiming < 220 when the new method does not lower costs. A mistake could be implementing

the method when it does not help.

c. Concluding 220 when the method really would lower costs. This could lead to not

implementing a method that would lower costs.

x 0 19.4 20

9. a. z= = = 2.12

/ n 2 / 50

b. Lower tail p-value is the area to the left of the test statistic

d. Reject H0 if z -1.645

x 0 26.4 25

10. a. z= = = 1.48

/ n 6 / 40

b. Upper tail p-value is the area to the right of the test statistic

d. Reject H0 if z 2.33

x 0 14.15 15

11. a. z= = = 2.00

/ n 3 / 50

Chapter 9

x 0 78.5 80

12. a. z= = = 1.25

/ n 12 / 100

Lower tail p-value is the area to the left of the test statistic

x 0 77 80

b. z= = = 2.50

/ n 12 / 100

Lower tail p-value is the area to the left of the test statistic

x 0 75.5 80

c. z= = = 3.75

/ n 12 / 100

Lower tail p-value is the area to the left of the test statistic

x 0 81 80

d. z= = = .83

/ n 12 / 100

Lower tail p-value is the area to the left of the test statistic

x 0 52.5 50

a. z= = = 2.42

/ n 8 / 60

9-4

Hypothesis Testing

x 0 51 50

b. z= = = .97

/ n 8 / 60

x 0 51.8 50

c. z= = = 1.74

/ n 8 / 60

x 0 23 22

14. a. z= = = .87

/ n 10 / 75

x 0 25.1 22

b. z= = = 2.68

/ n 10 / 75

x 0 20 22

c. z= = = 1.73

/ n 10 / 75

x 0 910 1056

b. z= = = 1.83

/ n 1600 / 400

Lower tail p-value is the area to the left of the test statistic

c. p-value .05, reject H0. Conclude the mean refund of last minute filers is less than $1056.

Chapter 9

d. Reject H0 if z -1.645

x 0 915 895

b. z= = = 1.19

/ n 225 / 180

Upper tail p-value is the area to the right of the test statistic

c. Do not reject H0. We cannot conclude the rental rates have increased.

d. Recommend withholding judgment and collecting more data on apartment rental rates before

drawing a final conclusion.

Ha: 125,500

b. z= = = 1.58

/ n 30, 000 / 40

c. p-value > .05, do not reject H0. We cannot conclude that the year-end bonuses paid by Jones & Ryan

Ha: 4.1

x 0 3.4 4.1

b. z= = = 2.21

/ n 2 / 40

9-6

Hypothesis Testing

Reject H0 and conclude that the return for Mid-Cap Growth Funds differs significantly from that for

U.S. Diversified funds.

Upper tail p-value is the area to the right of the test statistic

p-value .05, reject H0. Conclude that there has been an increase in the mean hourly wage of

production workers.

x

b. z= 0 = 30.63 32.79 = 2.73

n 5.6 50

d. p-value .01; reject H 0 . Conclude that the mean monthly internet bill is less in the southern state.

21. a. H0: 15

Ha: > 15

x 17 15

b. z= = = 2.96

/ n 4 / 35

c. Upper tail p-value is the area to the right of the test statistic

22. a. H0: = 8

Ha: 8

c. Do not reject H0. Cannot conclude that the population mean waiting time differs from 8 minutes.

Chapter 9

d. x z.025 ( / n )

x 0 14 12

23. a. t= = = 2.31

s/ n 4.32 / 25

b. Degrees of freedom = n 1 = 24

Upper tail p-value is the area to the right of the test statistic

Reject H0 if t 1.711

x 0 17 18

24. a. t= = = 1.54

s/ n 4.5 / 48

b. Degrees of freedom = n 1 = 47

Using t table: area in lower tail is between .05 and .10; therefore, p-value is between .10 and .20.

x 0 44 45

25. a. t= = = 1.15

s/ n 5.2 / 36

Degrees of freedom = n 1 = 35

Lower tail p-value is the area to the left of the test statistic

9-8

Hypothesis Testing

x 0 43 45

b. t= = = 2.61

s/ n 4.6 / 36

Lower tail p-value is the area to the left of the test statistic

x 0 46 45

c. t= = = 1.20

s/ n 5 / 36

Lower tail p-value is the area to the left of the test statistic

x 0 103 100

26. a. t= = = 2.10

s/ n 11.5 / 65

Degrees of freedom = n 1 = 64

Using t table; area in upper tail is between .01 and .025; therefore, p-value is between .02 and .05.

x 0 96.5 100

b. t= = = 2.57

s/ n 11/ 65

Using t table: area in lower tail is between .005 and .01; therefore, p-value is between .01 and .02.

Chapter 9

x 0 102 100

c. t= = = 1.54

s/ n 10.5 / 65

Using t table: area in upper tail is between .05 and .10; therefore, p-value is between .10 and .20.

x 0 231 238

b. t= = = .88

s/ n 80 / 100

Degrees of freedom = n 1 = 99

Lower tail p-value is the area to the left of the test statistic

c. p-value > .05; do not reject H0. Cannot conclude mean weekly benefit in Virginia is less than the

national mean.

d. df = 99 t.05 = -1.66

Reject H0 if t -1.66

x 0 3740 3530

b. t= = = 2.49

s/ n 810 / 92

Degrees of freedom = n 1 = 91

Upper tail p-value is the area to the right of the test statistic

c. p-value .01; reject H0. The mean attendance per game has increased. Anticipate a new all-time high

season attendance during the 2002 season.

9 - 10

Hypothesis Testing

Ha: 5600

x 0 5835 5600

b. t= = = 2.26

s/ n 520 / 25

Degrees of freedom = n 1 = 24

Using t table: area in lower tail is between .01 and .025; therefore, p-value is between .02 and .05.

c. p-value .05; reject H0. The mean diamond price in New York City differs.

d. df = 24 t.025 = 2.064

Ha: 600

x 0 612 600

b. t= = = 1.17

s/ n 65 / 40

df = n - 1 = 39

Using t table: area in upper tail is between .10 and .20; therefore, p-value is between .20 and .40.

c. With = .10 or less, we cannot reject H0. We are unable to conclude there has been a change in the

mean CNN viewing audience.

d. The sample mean of 612 thousand viewers is encouraging but not conclusive for the sample of 40

days. Recommend additional viewer audience data. A larger sample should help clarify the situation

for CNN.

x 0 51 47.50

t= = = 2.33

s/ n 12 / 64

Degrees of freedom = n - 1 = 63

Chapter 9

Upper tail p-value is the area to the right of the test statistic

Reject H0; Atlanta customers are paying a higher mean water bill.

Ha: 10,192

x 0 9750 10,192

b. t= = = 2.23

s/ n 1400 / 50

Degrees of freedom = n 1 = 49

Using t table: area in lower tail is between .01 and .025; therefore, p-value is between .02 and .05.

c. p-value .05; reject H0. The population mean price at this dealership differs from the national mean

price $10,192.

x 0 24.1 21.6

c. t= = = 2.08

s/ n 4.8 / 16

Degrees of freedom = n 1 = 15

Upper tail p-value is the area to the right of the test statistic

d. p-value .05; reject H0. The population mean consumption of milk in Webster City is greater than

the National mean.

34. a. H0: = 2

Ha: 2

xi 22

b. x= = = 2.2

n 10

9 - 12

Hypothesis Testing

2

( xi x )

c. s= = .516

n 1

x 0 2.2 2

d. t= = = 1.22

s/ n .516 / 10

Degrees of freedom = n - 1 = 9

Using t table: area in upper tail is between .10 and .20; therefore, p-value is between .20 and .40.

e. p-value > .05; do not reject H0. No reason to change from the 2 hours for cost estimating purposes.

p p0 .175 .20

35. a. z= = = 1.25

p0 (1 p0 ) .20(1 .20)

n 400

d. z.025 = 1.96

p p0 .68 .75

36. a. z= = = 2.80

p0 (1 p0 ) .75(1 .75)

n 300

Lower tail p-value is the area to the left of the test statistic

.72 .75

b. z= = 1.20

.75(1 .75)

300

Lower tail p-value is the area to the left of the test statistic

Chapter 9

.70 .75

c. z= = 2.00

.75(1 .75)

300

Lower tail p-value is the area to the left of the test statistic

.77 .75

d. z= = .80

.75(1 .75)

300

Lower tail p-value is the area to the left of the test statistic

52

b. p= = .13

400

p p0 .13 .125

z= = = .30

p0 (1 p0 ) .125(1 .125)

n 400

Upper tail p-value is the area to the right of the test statistic

c. p-value > .05; do not reject H0. We cannot conclude that there has been an increase in union

membership.

Ha: p .64

52

b. p= = .52

100

p p0 .52 .64

z= = = 2.50

p0 (1 p0 ) .64(1 .64)

n 100

9 - 14

Hypothesis Testing

c. p-value .05; reject H0. Proportion differs from the reported .64.

d. Yes. Since p = .52, it indicates that fewer than 64% of the shoppers believe the supermarket brand is

as good as the name brand.

Ha: p .70

252

b. Wisconsin p = = .72

350

p p0 .72 .70

z= = = .82

p0 (1 p0 ) .70(1 .70)

n 350

189

California p = = .63

300

.63 .70

z= = 2.65

.70(1 .70)

300

Reject H0. California has a different (lower) percentage of adults who do not exercise regularly.

414

40. a. p= = .2702 (27%)

1532

b. H0: p .22

p p0 .2702 .22

z= = = 4.75

p0 (1 p0 ) .22(1 .22)

n 1532

Chapter 9

Upper tail p-value is the area to the right of the test statistic

c. These studies help companies and advertising firms evaluate the impact and benefit of commercials.

p p0 .67 .70

b. z= = = 1.13

p0 (1 p0 ) .70(1 .70)

n 300

Lower tail p-value is the area to the left of the test statistic

c. p-value > .05; do not reject H0. The executive's claim cannot be rejected.

93

p= = .31

300

p p0 .31 .24

z= = = 2.84

p0 (1 p0 ) .24(1 .24)

n 300

Upper tail p-value is the area to the right of the test statistic

p-value .05; reject H0. In 2003, an estimated 31% of people who moved selected to be convenient

to work as their primary reason. This is an increase compared to 1990.

13

p= = .13

100

p p0 .13 .10

c. z= = = 1.00

p0 (1 p0 ) .10(1 .10)

n 100

9 - 16

Hypothesis Testing

Upper tail p-value is the area to the right of the test statistic

232

b. p= = .58

400

p p0 .58 .51

z= = = 2.80

p0 (1 p0 ) (.51)(.49)

n 400

Upper tail p-value is the area to the right of the test statistic

c. Since p-value = .0026 .01, we reject H0 and conclude that people working the night shift get

drowsy while driving more often than the average for the entire population.

Ha: p .30

24

b. p= = .48

50

p p0 .48 .30

c. z= = = 2.78

p0 (1 p0 ) .30(1 .30)

n 50

We would conclude that the proportion of stocks going up on the NYSE is not 30%. This would

suggest not using the proportion of DJIA stocks going up on a daily basis as a predictor of the

proportion of NYSE stocks going up on that day.

Chapter 9

5

46. x = = = .46

n 120

Ha: < 10

H0: 10

.05

x

10

Reject H0 if x 9.25

a. When = 9,

9.25 9

z= = .55

5 / 120

b. Type II error

c. When = 8,

9.25 8

z= = 2.74

5 / 120

10

x = = = .71

n 200

9 - 18

Hypothesis Testing

Ha : 20 H0: = 20 Ha: 20

.025 .025

x x

c1 20 c2

a. = 18

18.61 18

z= = .86

10 / 200

b. = 22.5

21.39 22.5

z= = 1.57

10 / 200

c. = 21

21.39 21

z= = .55

10 / 200

= .7088

48. a. H0: 15

Ha: > 15

Concluding 15 when this is not true. Fowle would not charge the premium rate even though the

rate should be charged.

Chapter 9

b. Reject H0 if z 2.33

x 0 x 15

z= = = 2.33

/ n 4 / 35

Decision Rule:

Reject H0 if x 16.58

For = 17,

16.58 17

z= = .62

4 / 35

= .2676

c. For = 18,

16.58 18

z= = 2.10

4 / 35

= .0179

49. a. H0: 25

Ha: < 25

Reject H0 if z -2.05

x 0 x 25

z= = = 2.05

/ n 3 / 30

Decision Rule:

Reject H0 if x 23.88

b. For = 23,

23.88 23

z= = 1.61

3 / 30

9 - 20

Hypothesis Testing

c. For = 24,

23.88 24

z= = .22

3 / 30

d. The Type II error cannot be made in this case. Note that when = 25.5, H0 is true. The Type II

error can only be made when H0 is false.

50. a. Accepting H0 and concluding the mean average age was 28 years when it was not.

x 0 x 28

z= =

/ n 6 / 100

at z = -1.96, x = 26.82

at z = +1.96, x = 29.18

Decision Rule:

At = 26,

26.82 26

z= = 1.37

6 / 100

At = 27,

26.82 27

z= = .30

6 / 100

At = 29,

29.18 29

z= = .30

6 / 100

= .6179

Chapter 9

At = 30,

29.18 30

z= = 1.37

6 / 100

= .0853

c. Power = 1 -

When = 26, there is a .9147 probability that the test will correctly reject the null hypothesis that

= 28.

51. a. Accepting H0 and letting the process continue to run when actually over - filling or under - filling

exists.

For = 16.5

16.29 16.5

z= = 1.44

.8 / 30

= .0749

x

16.29 16.5

9 - 22

Hypothesis Testing

d. The power curve shows the probability of rejecting H0 for various possible values of . In particular,

it shows the probability of stopping and adjusting the machine under a variety of underfilling and

overfilling situations. The general shape of the power curve for this case is

1.00

.75

Power .50

.25

.00

15.6 15.8 16.0 16.2 16.4

Possible Values of u

4

52. c = 0 + z.01 = 15 + 2.33 = 16.32

n 50

16.32 17

At = 17 z = = 1.20

4 / 50

= .1151

16.32 18

At = 18 z = = 2.97

4 / 50

= .0015

Increasing the sample size reduces the probability of making a Type II error.

75

c = 0 + z.05 = 100 + 1.645 = 119.51

n 40

119.51 120

At = 120 z= = .04

75 / 40

= .4840

119.51 130

c. At = 130 z = = .88

75 / 40

= .1894

Chapter 9

75

c = 0 + z.05 = 100 + 1.645 = 113.79

n 80

113.79 120

At = 120 z = = .74

75 / 80

= .2296

113.79 130

At = 130 z = = 1.93

75 / 80

= .0268

Increasing the sample size from 40 to 80 reduces the probability of making a Type II error.

54. n= 2

= = 214

(0 a ) (10 9) 2

55. n= 2

= = 325

(0 a ) (20 22) 2

= .18

n= 2

= = 108.09 Use 109

(0 a ) (3 2.9375) 2

= 30

n= 2

= = 44.4 Use 45

(0 a ) (400 385) 2

58. At 0 = 28, = .05. Note however for this two - tailed test, z / 2 = z.025 = 1.96

=6

n= = = 324

(0 a )2 (28 29) 2

9 - 24

Hypothesis Testing

=3

n= 2

= = 75.2 Use 76

(0 a ) (25 24) 2

60. a. H0: = 16

Ha: 16

x 0 16.32 16

b. z= = = 2.19

/ n .8 / 30

x 0 15.82 16

c. z= = = 1.23

/ n .8 / 30

p-value > .05; do not reject H0. Continue the production line.

Ha: 900

b. x z.025

n

180

935 1.96

200

Chapter 9

x 0 935 900

d. z= = = 2.75

/ n 180 / 200

Ha: > 119,155

x 0 126,100 119,155

b. z= = = 2.60

/ n 20, 700 / 60

Upper tail p-value is the area to the right of the test statistic

c. p-value .01, reject H0. We can conclude that the mean annual household income for theater goers

in the San Francisco Bay area is higher than the mean for all Playbill readers.

63. The hypothesis test that will allow us to conclude that the consensus estimate has increased is given

below.

H0: 250,000

t= = = 2.981

s/ n 24, 000 / 20

Degrees of freedom = n 1 = 19

Upper tail p-value is the area to the right of the test statistic

Ha: 6000

x 0 5812 6000

t= = = .93

s/ n 1140 / 32

Degrees of freedom = n 1 = 31

9 - 26

Hypothesis Testing

Using t table: area in lower tail is between .10 and .20; therefore, p-value is between .20 and .40.

Do not reject H0. There is no evidence to conclude that the mean number of freshman applications

has changed.

x 0 6130 6883

b. t= = = 1.89

s/ n 2518 / 40

Degrees of freedom = n 1 = 39

Lower tail p-value is the area to the left of the test statistic

c. We should conclude that Medicare spending per enrollee in Indianapolis is less than the national

average.

t= = = 2.26

s/ n 12,500 / 32

Degrees of freedom = 32 1 = 31

Upper tail p-value is the area to the right of the test statistic

p-value .05; reject H0. Conclude that the mean cost is greater than $125,000 per lot.

Chapter 9

Ha: 2.357

xi

x= = 2.3496

n

2

( xi x )

s= = .0444

n 1

x 0 2.3496 2.3570

t= = = 1.18

s/ n .0444 / 50

Degrees of freedom = 50 - 1 = 49

Using t table: area in lower tail is between .10 and .20; therefore, p-value is between .20 and .40.

There is not a statistically significant difference between the National mean price per gallon and the

mean price per gallon in the Lower Atlantic states.

64

b. p= = .64

100

p p0 .64 .50

c. z= = = 2.80

p0 (1 p0 ) .50(1 .50)

n 100

Upper tail p-value is the area to the right of the test statistic

p-value .01; reject H0. College graduates have a greater stop-smoking success rate.

Ha: p .6667

355

b. p= = .6502

546

9 - 28

Hypothesis Testing

p p0 .6502 .6667

c. z= = = .82

p0 (1 p0 ) .6667(1 .6667)

n 546

p-value > .05; do not reject H0; Cannot conclude that the population proportion differs from 2/3.

252

b. p= = .84 (84%)

300

p p0 .84 .80

c. z= = = 1.73

p0 (1 p0 ) .80(1 .80)

n 300

Upper tail p-value is the area to the right of the test statistic

d. p-value .05; reject H0. Conclude that more than 80% of the customers are satisfied with the service

provided by the home agents. Regional Airways should consider implementing the home agent

system.

503

71. a. p= = .553

910

b. H0: p .50

p p0 .553 .500

c. z= = = 3.19

p0 (1 p0 ) (.5)(.5)

n 910

Upper tail p-value is the area to the right of the test statistic

You can tell the manager that the observed level of significance is very close to zero and that this

means the results are highly significant. Any reasonable person would reject the null hypotheses and

conclude that the proportion of adults who are optimistic about the national outlook is greater

than .50

Chapter 9

49

p= = .8448

58

p p0 .8448 .90

z= = = 1.40

p0 (1 p0 ) .90(1 .90)

n 58

Lower tail p-value is the area to the left of the test statistic

p-value > .05; do not reject H0. Claim of at least 90% cannot be rejected.

81

b. p= = .2025

400

p p0 .2025 .24

c. z= = = 1.76

p0 (1 p0 ) .24(1 .24)

n 400

Lower tail p-value is the area to the left of the test statistic

The proportion of workers not required to contribute to their company sponsored health care plan has

declined. There seems to be a trend toward companies requiring employees to share the cost of

health care benefits.

74. a. H0: 72

Ha: > 72

Reject H0 if z 1.645

x 0 x 72

z= = = 1.645

/ n 20 / 30

Solve for x = 78

Decision Rule:

Accept H0 if x < 78

9 - 30

Hypothesis Testing

Reject H0 if x 78

b. For = 80

78 80

z= = .55

20 / 30

= .2912

c. For = 75,

78 75

z= = .82

20 / 30

= .7939

d. For = 70, H0 is true. In this case the Type II error cannot be made.

e. Power = 1 -

1.0

.8

P

o

.6

w

e

r .4

.2

72 74 76 78 80 82 84

Possible Values of

Ho False

n= 2

= = 218.5 Use 219

(0 a ) (15, 000 14, 000) 2

Ha: 120

Chapter 9

n= 2

= = 44.7 Use 45

(0 a ) (120 117) 2

x 0 x 120

z= =

/ n 5 / 45

At z = +1.96, x = 121.46

Decision Rule:

For = 118,

118.54 118

z= = .72

5 / 45

= .2358

Other Results:

If is z

117 2.07 .0192

118 .72 .2358

119 -.62 .7291

121 +.62 .7291

122 +.72 .2358

123 -2.07 .0192

9 - 32

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