A Manufacturer Claims That Less Than 1% of All His

question 37

Multiple Choice

A manufacturer claims that less than 1% of all his products do not meet the minimum government
Standards. A survey of 500 products revealed ten did not meet the standard.
If the z-statistic is -1.96 and the level of significance is 0.01, what is your decision?

• A) You reject the null hypothesis.
• B) You have insufficient evidence to reject the null hypothesis.
• C) You accept the alternate hypothesis and agree that less than 1% meet government standards.
• D) You should have used the t-test.

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Definitions:

Statute of Limitations

The maximum period of time after an event within which legal proceedings may be initiated.

Licensed Provider

An individual or entity that has received official authorization or certification to offer services in a particular professional field.

Miracle Cures

Unverified and often exaggerated treatments claimed to cure diseases or ailments quickly and without side effects.

Fraud

The deliberate deception or dishonesty intended to result in financial or personal gain.