To be considered 18-karat (18K) gold, a piece of jewelry must be made of 75% pure gold. The higher the karats, the more valuable a piece of jewelry. A jewelry designer is purchasing a large quantity of 18K gold from a new supplier. To see if the new supplier is being dishonest about the karat rating in the shipment, the designer melts a random sample of the gold and conducts a hypothesis test with H0: The proportion of metal that is gold is 75%, and Ha: The proportion of metal that is gold is less than 75%. What is a Type I error and its consequence in this context? A) The gold shipment truly is made of less than 75% gold, but the designer concludes that it is made of 75% gold. The designer will reject the shipment of gold and miss out on an honest business relationship with the supplier. B) The gold shipment truly is made of less than 75% gold, but the designer concludes that it is made of 75% gold. The designer will accept the shipment of gold and produce inferior jewelry. C) The gold shipment truly is made of 75% gold, but the designer concludes that it is made of less than 75% gold. The designer will reject the shipment of gold and miss out on an honest business relationship with the supplier. D) The gold shipment truly is made of 75% gold, but the designer concludes that it is made of less than 75% gold. The designer will accept the shipment of gold and produce inferior jewelry.

Holt Mcdougal Larson Pre-algebra: Student Edition 2012

1st Edition

ISBN:9780547587776

Author:HOLT MCDOUGAL

Publisher:HOLT MCDOUGAL

Chapter11: Data Analysis And Probability

Section: Chapter Questions

Problem 8CR

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To be considered 18-karat (18K) gold, a piece of jewelry must be made of 75% pure gold. The higher the karats, the more valuable a piece of jewelry. A jewelry designer is purchasing a large quantity of 18K gold from a new supplier. To see if the new supplier is being dishonest about the karat rating in the shipment, the designer melts a random sample of the gold and conducts a hypothesis test with H₀: The proportion of metal that is gold is 75%, and H_a: The proportion of metal that is gold is less than 75%. What is a Type I error and its consequence in this context?

A) The gold shipment truly is made of less than 75% gold, but the designer concludes that it is made of 75% gold. The designer will reject the shipment of gold and miss out on an honest business relationship with the supplier.

B) The gold shipment truly is made of less than 75% gold, but the designer concludes that it is made of 75% gold. The designer will accept the shipment of gold and produce inferior jewelry.

C) The gold shipment truly is made of 75% gold, but the designer concludes that it is made of less than 75% gold. The designer will reject the shipment of gold and miss out on an honest business relationship with the supplier.

D) The gold shipment truly is made of 75% gold, but the designer concludes that it is made of less than 75% gold. The designer will accept the shipment of gold and produce inferior jewelry.

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