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(1) We are conducting many hypothesis tests to test a claim. Assuming the null hypothesis is true, approximately how many of the 200 tests, using a significance level of 5%, will incorrectly find significance?

(1) We are conducting many hypothesis tests to test a claim. Assuming the null hypothesis is true, approximately how many of the 200 tests, using a significance level of 5%, will incorrectly find significance?

Glencoe Algebra 1, Student Edition, 9780079039897, 0079039898, 2018
Glencoe Algebra 1, Student Edition, 9780079039897, 0079039898, 2018
18th Edition
ISBN:9780079039897
Author:Carter
Publisher:Carter
Chapter4: Equations Of Linear Functions
Section: Chapter Questions
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(1) We are conducting many hypothesis tests to test a claim. Assuming the null hypothesis is true, approximately how many of the 200 tests, using a significance level of 5%, will incorrectly find significance? (2) For the situation described below, indicate whether it makes more sense to use a relatively large significance level (such as a = 0.10) or a relatively small significance level (such as a = 0.01). Testing to see if a large investment firm is participating in the illegal prac- tice of insider trading. If there is evidence, the Securities and Exchange Commission will file a lawsuit against them. (3) Dropouts The National Center for Education Statistics reports that the high school dropout rate is 5.3%. Due to tougher standards and high-stakes tests, teachers in New York State believe that the high school dropout rate in New York State differs from the national rate. (a) Define the relevant parameter and state the null and alternative hypothesis (b) The teachers select a random sample and construct a 95% confidence interval of (0.049, 0.061). Using the confidence interval, what is the conclusion of the test? Include an indication of the significance level. (c) State the conclusion of test in context. 4
Transcribed Image Text:(1) We are conducting many hypothesis tests to test a claim. Assuming the null hypothesis is true, approximately how many of the 200 tests, using a significance level of 5%, will incorrectly find significance? (2) For the situation described below, indicate whether it makes more sense to use a relatively large significance level (such as a = 0.10) or a relatively small significance level (such as a = 0.01). Testing to see if a large investment firm is participating in the illegal prac- tice of insider trading. If there is evidence, the Securities and Exchange Commission will file a lawsuit against them. (3) Dropouts The National Center for Education Statistics reports that the high school dropout rate is 5.3%. Due to tougher standards and high-stakes tests, teachers in New York State believe that the high school dropout rate in New York State differs from the national rate. (a) Define the relevant parameter and state the null and alternative hypothesis (b) The teachers select a random sample and construct a 95% confidence interval of (0.049, 0.061). Using the confidence interval, what is the conclusion of the test? Include an indication of the significance level. (c) State the conclusion of test in context. 4
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