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#1

A random sample of 1520 job applicants found that 58 of them failed a drug test.

Use a significance level of 0.025 to test the claim that significantly fewer than 5% of job applicants fail drug tests.

(20 points)

#2

A random sample of 1228 medical malpractice suits found that 856 of them were later dropped or dismissed.
(based on data from the Physician Insurers Association of America).							(20 points)
Test the claim that more than 60% of malpractice suits are dropped or dismissed.
Use a significance level of a = 0.025.

#3

A sample of 36 movies contains 15 that are rated R, and a sample of 50 children’s movies contains 28 that feature tobacco use.
Test the claim that the percentage of children's movies that feature tobacco use is significantly greater than the percentage of movies that are rated R.
Use a significance level of 0.025 .				(20 points)

Notes

HYPOTHESIS TESTING FOR PROPORTIONS
									Comparing two independent means:
1. CLAIM concerning a population proportion, will contain <, > , not equal ¹							p < "value"		H0: p1 - p2 = 0
2. Null Hypothesis		H0	statement of equality, p = "value"						H1: p1 - p2 < 0 or > 0
3. Alternative Hypothesis			H1	same as claim
				<	left-tailed test				p-pooled = (x1 + x2)/(n1+ n2)
				>	right-tailed test
				¹	two-tailed				SE = SQRT(p-pooled(1 - p-pooled)/n1 + p-pooled(1 - p-pooled)/n2)
	Normal probability distribution				based on assumption in the Null hypothesis
		bell curve
4. Choose significance level			is the complement of the confidence level
	for example, a confidence level of 95% is equivalent to a significance level of 5%
	confidence level defined the "likely" values
	significance level defines the "unlikely" values, the probability of being in the tail.
5. compute the value of the sample statistic p hat = x/n
	Compute the standard error			SE=sqrt(p*(1-p)/n)		Use p from H0
6. Compute probability value or p-value
	p-value = P(sample statistic <= computed sample statistic)						left-tailed test	NORM.DIST
	p-value = P(sample statistic >= computed sample statistic)						right-tailed test	1 - NORM.DIST
	p-value = twice the area of the tail defined by p						two-taield
7. Initial Conclusion			Reject Null or Do not reject Null/Support Null
			Reject Null and support Alternative=Claim
		or	Do not reject Null and do not support the claim
	rejection rule:		Reject the Null if p-value is less than significance level; otherwise, fail to reject the Null
8. Final Conclusion			Sentence:	The sample data support the claim that….
			or	The sample data do not support the claim that…