Chapter 20, Problem 5E

To determine

To explain is it reasonable to conclude that the new formula and the old one are equally effective.

Answer to Problem 5E

No, it is not.

Explanation of Solution

It is given in the question that a company’s old antacid formula provided relief for $70\%$ of people who used it. The company tests a new formula to see if it is better and gets a P-value of $0.27$ . Since the p-value is relatively high, there's no evidence that the new formula is more effective than the old formula. However, this result does not necessarily imply that the two formulas are equally effective. So, no, it is reasonable to conclude that the new formula and the old one are equally effective.