Suppose a Study Was Conducted to See Whether There Is

question 18

Multiple Choice

Suppose a study was conducted to see whether there is an association between marital status and vehicle color. The table below shows the results from the study. Assume all conditions for testing have been met. $\begin{array}{c|c|c|c} & {\text { Vehicle color }} \\& \text { red } & \text { black/white/silver } & \text { blue/green/other } \\\hline \text { Married } & 45 & 22 & 19 \\\hline \text { Unmarried } & 35 & 11 & 18\end{array}$
This was an observational study of randomly chosen vehicle owners. Test the hypothesis that marital status and vehicle color are associated, using a significance level of $0.05$ . Choose the correct decision regarding the null hypothesis and conclusion. Refer to the computer output below.
$\begin{array} { | l | } \hline \chi ^ { 2 } - \text { Test } \\X ^ { 2 } = 1.754774169 \\p = .4158681217 \\\mathrm { df } = 2\\\hline\end{array}$

• A) Reject the null hypothesis; marital status and vehicle color are not associated.
• B) Fail to reject the null hypothesis; marital status and vehicle color are not associated.
• C) Fail to reject the null hypothesis; marital status and vehicle color are associated.
• D) Reject the null hypothesis; marital status and vehicle color are associated.

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Definitions:

Payback Period

The length of time it takes for an investment to recover its initial expenditure from the cash inflows that it generates.

After-Tax Discount Rate

The rate used to discount future cash flows to their present value, adjusted for the impact of taxes.

Income Tax Rate

The percentage of taxable income that individuals or corporations are required to pay to the government.

Working Capital

The difference between a company's current assets and current liabilities, indicating the liquidity and operational efficiency.