Question

An investigator analyzed the leading digits from 773 checks issued by seven suspect companies. The frequencies were found to be 243, 140, 114, 63, 59, 46, 49, 3 and 25, and those digits correspond to the leading digits of 1,2. 3, 4, 5,6, 7, 8, and 9, respectively If the observed frequencies are substantially different from the requencies expected with Benford's law shown below, the check amounts appear to result from fraud Use a 0.01 significance level to test for goodness-of-fit with Benford's law Does it appear that the checks are the result of fraud? Digt Achual Frequenc Benfords Law. Distribution of Leading Digts 114 30. % ㄧ一176%ーー125%-一-57%一一一7.9% 243 140 59 49 58% 34 51% 25 4 6% 67% Determine the null and alternative hypotheses Ho H, Calculate the test statistic, Round to three decimal places as neoded Calculate the P-value P-value (Round to four decimal places as needed ) State the conclusion ▼ Ho There sufficient evidence to warrant re ection of the claim that the leading digits are from a population with a distribution that conta ms to that the checks are the result of fraud ▼ Benford's law It

Answer 1

H0 : It appear that the checks are the result of fraud
HA: It appear that the checks are not the result of fraud

chi^2 = 10.597

p value = 1.5489

Reject H0 There is sufficient evidence to warrant th erejection of the claim. It appear thta the checks are the result of fraud