ECON2122 - Chapter 9

Mary Arnold wants to use the results of a random sample market survey to seek strong evidence that her brand of breakfast cereal has more than 20% of the total market. Formulate the null and alternative hypotheses, using P as the population proportion.

The significance level and the probability of a Type I error are equivalent.

• True

• False

The probability of rejecting the null hypothesis when the null hypothesis is false is known as the power of the test

• TRUE

• FALSE

The probability of rejecting a true null hypothesis is denoted as β.

• TRUE

• FALSE

The p-value of a test is the probability that the null hypothesis is true.

• TRUE

• FALSE