Conduct a Full Hypothesis Test and Determine If the Given

question 1

Multiple Choice

Conduct a full hypothesis test and determine if the given claim is supported or not supported at the 0.05 significance level. Round all amounts and standard scores to two decimal places.
-According to a recent poll 53% of Americans would vote for the incumbent president. If a random sample of 100 people results in 25% who would vote for the incumbent, test whether the claim that the actual percentage is different from 53% is supported or not supported.

• A)supported
• B)not supported

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Definitions:

Long Put Option

A financial derivative strategy that gives the holder the right, but not the obligation, to sell a specific amount of an underlying asset at a predetermined price within a specified timeframe.

Binomial Option Model

A mathematical model used to price options by breaking down the time to expiration into potentially infinite segments or steps.

Subintervals

Divisions within a larger interval, often used in mathematics to partition an interval into smaller segments.

Implied Volatility

The predicted future movement in a security's price as inferred from the pricing of its options in the market.