Eric Roberts, Inc. is a company that specializes in tax-deferred investment opportunities for its clients. Recently, this company offered a payroll deduction investment program for the employees of a particular company. The company estimates that the employees are currently averaging $110 or less per month in tax-deferred investments. A sample of 80 employees will be used to test the company’s hypothesis about the current level of investment activity among the population of employees. Assume the employee monthly tax-deferred investment amounts have a standard deviation of $70 and that a 0.05 level of significance will be used in the hypothesis test. What is the probability of the Type II error if the actual mean employee monthly investment is $125?
Inverse Normal Distribution
The method used for finding the corresponding z-critical value in a normal distribution using the known probability is said to be an inverse normal distribution. The inverse normal distribution is a continuous probability distribution with a family of two parameters.
Mean, Median, Mode
It is a descriptive summary of a data set. It can be defined by using some of the measures. The central tendencies do not provide information regarding individual data from the dataset. However, they give a summary of the data set. The central tendency or measure of central tendency is a central or typical value for a probability distribution.
Z-Scores
A z-score is a unit of measurement used in statistics to describe the position of a raw score in terms of its distance from the mean, measured with reference to standard deviation from the mean. Z-scores are useful in statistics because they allow comparison between two scores that belong to different normal distributions.
Eric Roberts, Inc. is a company that specializes in tax-deferred investment opportunities for its clients. Recently, this company offered a payroll deduction investment program for the employees of a particular company. The company estimates that the employees are currently averaging $110 or less per month in tax-deferred investments. A sample of 80 employees will be used to test the company’s hypothesis about the current level of investment activity among the population of employees. Assume the employee monthly tax-deferred investment amounts have a standard deviation of $70 and that a 0.05 level of significance will be used in the hypothesis test. What is the
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