A Health Insurer Has Determined That the "Reasonable and Customary $$\begin{array}{l}\mathrm{H}_{0}: \mu=\$ 1200 \\\mathrm{H}_{\mathrm{a}}: \mu>\$ 1200\end{array}$$

question 23

Multiple Choice

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. The hypotheses are: $$\begin{array}{l}\mathrm{H}_{0}: \mu=\$ 1200 \\\mathrm{H}_{\mathrm{a}}: \mu>\$ 1200\end{array}$$
Explain the meaning of a correct decision.

• A) Concluding that \( \mu>\$ 1200 \) when in fact \( \mu=\$ 1200 \)
• B) Concluding that \( \mu<\$ 1200 \) when in fact \( \mu<\$ 1200 \)
• C) Failing to reject the hypothesis that \( \mu=\$ 1200 \) when in fact \( \mu>\$ 1200 \)
• D) Failing to reject the hypothesis that \( \mu=\$ 1200 \) when in fact \( \mu=\$ 1200 \) OR concluding that \( \mu> \) \( \$ 1200 \) when in fact \( \mu>\$ 1200 \)

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Definitions:

Classical Conditioning

A learning process that involves creating associations between a naturally occurring stimulus and a previously neutral stimulus.

Law of Effect

A psychological principle suggesting that behaviors followed by positive outcomes are likely to be repeated, while those with negative outcomes are not.

Spontaneous Recovery

The reappearance of a previously extinguished conditioned response after a pause, without the need for further conditioning.

Rational Appeal

A persuasive technique that uses logical arguments and factual evidence to convince the audience.