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Question 687916: Please help....Here is my problem statement.
Anna is analyzing private polling data - out of 1000 customers asked, 261 said that they would buy new purple lipstick. Assume that this data is unbiased.
The company that she works for has determined that if 25% of the company’s customer base buys the new product, the launch will be a success. Anna has to use this data to determine whether the launch looks like it will be a success or not. She sets the following hypotheses:
H0: π ≤ 0.25
HA:π > 0.25
Assuming α = 0.05 and the data given, should Anna reject H0 or not? Show all of your working, including the test criteria.
Thank you for your help.
Answer by stanbon(75887)   (Show Source):
You can put this solution on YOUR website! Anna is analyzing private polling data - out of 1000 customers asked, 261 said that they would buy new purple lipstick. Assume that this data is unbiased.
The company that she works for has determined that if 25% of the company’s customer base buys the new product, the launch will be a success. Anna has to use this data to determine whether the launch looks like it will be a success or not. She sets the following hypotheses:
H0: π ≤ 0.25
HA:π > 0.25 (success)
Assuming α = 0.05 and the data given, should Anna reject H0 or not? Show all of your working, including the test criteria.
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Critical value for 5% right-tail test: z = 1.645
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Test Stat: z(0.261) = (0.261-0.25)/sqrt[0.25*0.75/1000) = 0.8033
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Since the test stat is not in the reject interval, fail to reject Ho.
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Conclusion: The test results do not predict success for the product.
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Cheers,
Stan H.
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