TABLE 9-2 a Student Claims That He Can Correctly Identify Whether a Whether

question 151

Multiple Choice

TABLE 9-2
A student claims that he can correctly identify whether a person is a business major or an agriculture major by the way the person dresses. Suppose in actuality that if someone is a business major, the student can correctly identify that person as a business major 87% of the time. When a person is an agriculture major, the student will incorrectly identify that person as a business major 16% of the time. Presented with one person and asked to identify the major of this person (who is either a business or an agriculture major) , the student considers this to be a hypothesis test with the null hypothesis being that the person is a business major and the alternative that the person is an agriculture major.
-Referring to Table 9-2, what would be a Type I error?

• A) saying that the person is a business major when in fact the person is a business major
• B) saying that the person is a business major when in fact the person is an agriculture major
• C) saying that the person is an agriculture major when in fact the person is a business major
• D) saying that the person is an agriculture major when in fact the person is an agriculture major

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Definitions:

Government Debt

The total amount of money that a government owes to creditors, which can include foreign governments, domestic banks, and other financial institutions.

Lifetime Income

The total amount of money earned by an individual over the course of their life.

Consumption Tax

A tax on the purchase of goods and services, paid directly by consumers.

Tax-Advantaged

Refers to investments or accounts that offer tax benefits or exemptions to the investor, reducing the tax burden and enhancing potential financial returns.