Question

Many hotel chains that offer free Wi-Fi service to their customers have experienced increasing demand for Internet bandwidth and increasing costs. Marriott International would like to test the hypothesis that the proportion of customers that are carrying two Wi-Fi devices exceeds 0.60. A random sample of 120 Marriott customers found that 78 have two Wi-Fi devices. Marriott International would like to set ΅ = 0.01. The critical value for this hypothesis test would be

a. 1.96

b. 2.33

c. 1.28

d. 1.645

Answer 1

Solution: c. 1.28

Explanation:

Here clearly it is evident that Marriott International would like to test the hypothesis that the proportion of customers that are carrying two Wi-Fi devices exceeds 0.60

Let P be the true proportion of customers that are carrying two Wi-Fi devices.

We can state the null and alternative hypothesis as follows:

: P=0.60

: P>0.60

It is clearly a right-tailed test

So We have critical value Zα = Z0.1 = 1.28 (calculated from the standard normal table)