Question

The manager of a garment factory needs to determine whether the cloth purchased has a mean breaking strength of 50 pounds. The manufacturer specified standard deviation of 5 pounds is believed to be fairly accurate figure. A sample of 100 pieces revealed a mean breaking strength of 65 pounds. (a) Is there evidence to suggest that the cloth purchased is not meeting the required average breaking strength? Use a = 0.05 (10 marks) (b) The general manager of a major pharmaceutical company is considering to implement a new incentive scheme designed to increase sales turnover. Currently, the average sales turnover is RM 10 million. The manager wishes to investigate whether the new incentive scheme increases sales turnover. You are required to state the null and alternative hypothesis and identify Type I and Type II errors. (8 marks) (c) Explain the main difference between null hypothesis and alternative hypothesis. (2 marks)

Answer 1

(a) Given, X 65 l-50 n100 та5 Н. н: иt 50 X-м froro Z.score table , P= 0.9987 i given, Х-0.с5 e, p 0.4780 Reject Но as Z> 1.96

c)   The main difference between Null hypothesis and Alternative Hypothesis is that Null Hypothesis is a statement which defines no relationship between the two variables whereas Alternative hypothesis is a statement which shows that there is statistical significance between the two measured phenomena

(b) Null hypothesis: Hoaverage >10 Alteunate hypothesis H average 10 Hi is true Ho is true Ho is true Type erroy Type I error His true ypel error (ox) Correction ype B) correctien 1-