Question 257518
An airline claims that the no-show rate for passengers is less than 5%. In a sample of 420 randomly selected reservations, 19 were no-shows. Use a level of significance of  = 0.01 to test the airlines claim. (Round phat to 4 decimal places.) 
1. H0 : p >= 0.05 
Ha :p < 0.05
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2. alpha = 0.01 
3. Test statistics:
sample proportion: 19/420 = 0.04524
z(0.045) = (0.045-0.05)/sqrt[0.05*0.95/420] = -0.4702
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4. P-value or critical z0 or t0.
p-value = P(z<-0.4702) = 0.3191
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5. Rejection Region:
z< -2.3263..
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6. Decision: Since the p-value is greater than 1%, fail to reject Ho. 
7. Interpretation:
The airline is wrong.
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Cheers,
stan H.