Ophelia O'Brien, VP of Consumer Credit of Credit First Banks

question 6

Multiple Choice

Ophelia O'Brien, VP of Consumer Credit of Credit First Banks (CFB) , monitors the default rate on personal loans at the CFB member banks. One of her standards is "no more than 5% of personal loans should be in default." On each Friday, the default rate is calculated for a sample of 500 personal loans. Last Friday's sample contained 30 defaulted loans. Ophelia's null hypothesis is ___.

• A) π > 0.05
• B) π = 0.05
• C) n = 30
• D) n = 500
• E) n = 0.05

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