Equal opportunity? A company is sued for job discrimi-nation because only 19% of the newly hired candidates were minorities when 27% of all applicants were minori-ties. Is this strong evidence that the company’s hiring practices are discriminatory?a) Is this a one-tailed or a two-tailed test? Why?b) In this context, what would a Type I error be?c) In this context, what would a Type II error be? d) In this context, what is meant by the power of the test? e) If the hypothesis is tested at the 5% level of signifi-cance instead of 1%, how will this affect the power of the test?f) The lawsuit is based on the hiring of 37 employees.Is the power of the test higher than, lower than, or thesame as it would be if it were based on 87 hires?

MATLAB: An Introduction with Applications
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Author:Amos Gilat
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Equal opportunity? A company is sued for job discrimi-
nation because only 19% of the newly hired candidates
were minorities when 27% of all applicants were minori-
ties. Is this strong evidence that the company’s hiring
practices are discriminatory?
a) Is this a one-tailed or a two-tailed test? Why?
b) In this context, what would a Type I error be?
c) In this context, what would a Type II error be?
d) In this context, what is meant by the power of the test?
e) If the hypothesis is tested at the 5% level of signifi-
cance instead of 1%, how will this affect the power of
the test?
f) The lawsuit is based on the hiring of 37 employees.
Is the power of the test higher than, lower than, or the
same as it would be if it were based on 87 hires?
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