SOLUTION: Research in the gaming industry showed that 10% of all slot machines in the United States stop working each year. Short's Game Arcade has 60 slot machines and only 3 failed last ye

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Question 1054051: Research in the gaming industry showed that 10% of all slot machines in the United States stop working each year. Short's Game Arcade has 60 slot machines and only 3 failed last year. Use the five-step hypothesis-testing procedure at the 0.05 significance level to test whether this data contradicts the research report.

(a) State the null hypothesis and the alternate hypothesis. (Round your answers to 2 decimal places.)

H0: π =

H1: π ≠

(b)
State the decision rule for 0.05 significance level. (Negative amounts should be indicated by a minus sign. Round your answers to 2 decimal places.)
H0 is rejected if z is not between
and
.
(c-1)
Compute the value of the test statistic. (Negative amount should be indicated by a minus sign. Round your answer to 3 decimal places.)
z value is


(c-2) What is your decision regarding H0?


Reject
Do not reject

(d) Determine the p-value. (Round your answer to 4 decimal places.)
p-value


Answer by ewatrrr(24785) About Me  (Show Source):
You can put this solution on YOUR website!
0.05 significance level
(a) State the null hypothesis and the alternate hypothesis. (Round your answers to 2 decimal places.)
sample proportion = p-hat = 3/60 = 1/20 = .05
Ho: p = .10
Ha: p ≠ .10
(b)
State the decision rule for 0.05 significance level. (Negative amounts should be indicated by a minus sign. Round your answers to 2 decimal places.)
H0 is rejected if z is not between -1.96 and 1.96
|
(c-1)
Compute the value of the test statistic. (Negative amount should be indicated by a minus sign. Round your answer to 3 decimal places.)
test stat:: z(0.05) = (0.05-0.1)/sqrt[0.1*0.9/60] = -.05/.0387 = -1.291
|
(c-2) What is your decision regarding H0? -1.291 > -1.96 Do not Reject
|
(d) Determine the p-value. (Round your answer to 4 decimal places.)
p-value = InvNorm(-1.291) = .0984