The Power of a Statistical Test Is the Probability of

question 29

Multiple Choice

The power of a statistical test is the probability of

• A)failing to reject a false H₀ .
• B)failing to reject a true H₀ .
• C)rejecting a false H₀ .
• D)rejecting a true H₀ .

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Definitions:

Quantity Axis

A graphical representation element used in economics to indicate quantities, such as quantities of goods produced or sold.

Marginal Revenue

The extra revenue earned from the sale of an additional unit of a product or service.

Maximize Profits

The process by which a firm adjusts its production and pricing strategies to earn the highest possible profit.

Economic Profits

Profits calculated by subtracting both the explicit and implicit costs of production from total revenues.