A Hypothesis Test Is to Be Performed $\$ 1200$ They Suspect That the Average Fee Charged by One

question 67

Multiple Choice

A hypothesis test is to be performed. State the null and alternative hypotheses.
-A health insurer has determined that the "reasonable and customary" fee for a certain medical procedure is $\$ 1200$ . They suspect that the average fee charged by one particular clinic for this procedure is higher than $\$ 1200$ . The insurer wants to perform a hypothesis test to determine whether their suspicion is correct.

• A) Null hypothesis: mean fee \(= \$ 1200\)
• B) Null hypothesis: mean fee \(> \$ 1200\)
• Alternative hypothesis: mean fee \(> \$ 1200\)
• Alternative hypothesis: mean fee \(= \$ 1200\)
• C) Null hypothesis: mean fee \(= \$ 1200\)
• Alternative hypothesis: mean fee \(\geq \$ 1200\)
• D) Null hypothesis: mean fee \(< \$ 1200\)
• Alternative hypothesis: mean fee \(> \$ 1200\)

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Definitions:

Bad Policy

Decision-making or guidelines that result in adverse outcomes or fail to achieve the intended objectives, often criticized for inefficiency or ineffectiveness.

Government Intervention

Actions taken by a government to influence or directly manage an economy, industry, or market, typically with the goal of correcting market failures or achieving social objectives.

Securities Taxes

Taxes levied on the earnings from stocks, bonds, or other investment assets.

Wealth Destruction

The process by which the value of an asset or investment decreases significantly, reducing overall wealth.