A Test Of $H _ { 0 } : \mu =$

question 62

Multiple Choice

A test of $H _ { 0 } : \mu =$ 45 versus $H _ { 1 } : \mu < 45$ is performed using a significance level of $\alpha$ =0.01. The value of the test statistic is z=-2.24.
If the true value of $\mu$ is 45 , does the conclusion result in a Type I error, a Type II error, or a correct decision?

• A) Type I error
• B) Correct decision
• C) Type II error

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Definitions:

Fair-value Method

An accounting strategy used for valuing and assessing assets and liabilities based on current market prices or estimates.

Equity Method

An accounting technique used to assess the earnings of an investment in another company by recognizing the income earned proportional to ownership interest.

Accounting Principle

A guideline or rule that shapes the theoretical basis for accounting practices and financial reporting.

Intra-entity Gross Profits

Profits realized from transactions conducted within the same legal entity, often requiring elimination for accurate consolidated financial reporting.