1. a) What are the two decisions that you can make from performing a hypothesis test? b) In your own words, after learning about hypothesis tests, how is chat decision made? c) Discuss the types of errors that can be made when performing a hy- othesis test.

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1. a) What are the two decisions that you can make from performing a
hypothesis test?
b) In your own words, after learning about hypothesis tests, how is
that decision made?
c) Discuss the types of errors that can be made when performing a hy-
pothesis test.
d) Why can't we just survey all the population to find u and not have
to do a hypothesis test?
Transcribed Image Text:1. a) What are the two decisions that you can make from performing a hypothesis test? b) In your own words, after learning about hypothesis tests, how is that decision made? c) Discuss the types of errors that can be made when performing a hy- pothesis test. d) Why can't we just survey all the population to find u and not have to do a hypothesis test?
Expert Solution
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(a) Two decisions that can be made based on the result of a hypothesis test are:

  • Reject the null hypothesis
  • Fail to reject the null hypothesis.

(b) Decision is made based on the significance level and p-value:

Significance level refers to the degree of significance in which we accept or reject the null hypothesis. We usually take α=0.05, indicating that there is 5% chance of rejecting the null hypothesis, when it is true.

P-value is the probability of obtaining the value of the test statistic or a value more extreme, assuming the null hypothesis is true.

We reject H0: If the p-value is less than the significance level.

Fail to reject H0: If the p-value is greater than the significance level.

                     

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