Question

A manufacturer considers his production process to be out of control when defects exceed 3%. In a random sample of 85 items, the defect rate is 5.9% but the manager claims that this is only a sample fluctuation and the production is not really out of control . At the 0.01 level of significance, test the managers claim.  

HINTS: 1.57, 0.0582, 2.33

A) Step 1: What is the claim? Be careful, this is a tricky question; but the claim is in BOLD above. Which of these answers is it p<.03, p>.03, p=.03, P<=.03, p>=.03, or p=/=.03?

B) Step 2: What is the Hypothesis set up?

C) Is the claim related to the null hypothesis, or the alternate hypothesis?

D) Step 3: Calculate the test statistic: What is it?

E) You only need one of these answers: What is the P-value or Critical Z value?

F) Step 4: Do we "Reject Ho" or "Fail to reject the null hypothesis"?

G) Step 5: State the conclusion (must include 3 parts as discussed in lecture)

Answer 1