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Refer to Exercise 7.99.

a. Find b for each of the following values of the population mean: 74, 72, 70, 68, and 66.

b. Plot each value of b you obtained in part a against its associated population mean. Show b on the vertical axis and m on the horizontal axis. Draw a curve through the five points on your graph.

c. Use your graph of part b to find the approximate probability that the hypothesis test will lead to a Type II error when m = 73.

d. Convert each of the b values you calculated in part a to the power of the test at the specified value of m. Plot the power on the vertical axis against m on the horizontal axis. Compare the graph of part b with the power curve of this part.

e. Examine the graphs of parts b and d. Explain what they reveal about the relationships among the distance between the true mean m and the null hypothesized mean m0, the value of b, and the power.

Short Answer

Expert verified

a)0.0018

b) isontheverticalaxisandisonhorizonalaxis

c) =73is0.62

d) From figure 1.), it is clear that the value highest with the increment of the worth. From figure 2.), it is clear that the worth lowering with the increment of the worth. Also, the power curve beginning from 1.

e) If the distance between the true mean and the hypothesized mean 0raising, then power will be raising.

Step by step solution

01

(a) Population mean

We have to find the value for population mean: 74, 72, 70, 68, and 66

If

=74=P(x72.275)=Pz>72.275-7415/49=P(z>-0.81)=1-P(z<-0.81)1-0.20897=0.79103

If

role="math" localid="1664532990317" =66=P(x72.275)=Pz>72.275-6615/49=P(z>2.92)=1-P(z<2.92)=1-0.9982=0.0018

If

role="math" localid="1664533009209" =66=P(x72.275)=Pz>72.275-6615/49=P(z>2.92)=1-P(z<2.92)=1-0.9982=0.0018

If

If

=66=P(x72.275)=Pz>72.275-6615/49=P(z>2.92)=1-P(z<2.92)=1-0.9982=0.0018

02

(b) Horizontal and vertical axis

Obtain a graph were isonverticalaxisandisonhorizontalaxis.

From a.) value with respect to each population mean is given in the below table.



740.7910
720.4522
700.1469
680.0233
660.0018

03

(c) Type error II

From Figure 1), the approximate probability that the hypothesis test will lead to a Type II error when =73is0.62since is the probability of type II error.

04

(d) Power of the test specified value

The Power of the test at the specified value of

The formula for power is given below:

Power=1-

The table below shows the power of the test at the specified value of


Power
74 0.7910 0.209
72 0.4522 0.5478
70 0.1469 0.8531
68 0.0233 0.9767
66 0.0018 0.9982

Comparison:

From figure 1.), it is clear that the value highest with the increment of the worth. From figure 2.), it is clear that the worth lowering with the increment of the worth. Also, the power curve beginning from 1.

05

(e) They reveal about the link among the distance between true mean

After examining figure (1) and figure (2), if the distance among the true mean as well as the null hypothesized mean 0raising, then will decrease. If the distance between the true mean and the hypothesized mean 0raising, then power will be raising.

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Most popular questions from this chapter

7.87 Trading skills of institutional investors. Refer to The Journal of Finance (April 2011) analysis of trading skills of institutional investors, Exercise 7.36 (p. 410). Recall that the study focused on 鈥渞ound-trip鈥 trades, i.e., trades in which the same stock was both bought and sold in the same quarter. In a random sample of 200 round-trip trades made by institutional investors, the sample standard deviation of the rates of return was 8.82%. One property of a consistent performance of institutional investors is a small variance in the rates of return of round-trip trades, say, a standard deviation of less than 10%.

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A random sample of n observations is selected from a normal population to test the null hypothesis that 碌=10.Specify the rejection region for each of the following combinations of \(Ha,\alpha ,\) and n:

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