Question

A newsletter publisher believes that 30% of their readers own a Rolls Royce. A testing firm believes this is inaccurate and performs a test to dispute the publisher's claim. After performing a test at the 0.02 level of significance, the testing firm fails to reject the null hypothesis. What is the conclusion regarding the publisher's claim

Answer 1

The evidence is not sufficient at the 0.02 level of significance to reject the claim that the percentage is 30%.

Explanation:

Let's first state the null and alternative hypotheses for this research;

H0: p = 0.30

Ha: p ≠ 0.30

Now, since the bull hypothesis is the claim and he fails to reject the null hypothesis from the research, we will conclude that;

The evidence is not sufficient at the 0.02 level of significance to reject the claim that the percentage is 30%.