Where do CFOs get their money news? According to Robert Half International, 47%

Question

Where do CFOs get their money news? According to Robert Half International, 47% get their money news from newspapers, 15% get it from communication/colleagues, 12% get it from television, 11% from the internet, 9% from magazines, 5% from radio, and 1% do not know. Suppose a researcher wants to test these results. She randomly samples 67 CFOs and finds that 40 of them get their money news from newspapers. Does the test show enough evidence to reject the findings of Robert Half International ? Use a= .05.

Explanation / Answer

solution: Ho : p = 47% or 0.47 q = 1-p = 1- 0.47 = 0.53 n = 67 Standard error of p = S.E(p) = sqrt (pq/n) = sqrt (0.47*0.53/67) = sqrt 0.003718 = 0.061 Observed p = 40/67 = 0.60 Expected p = 47% = 0.47 Difference = (O-E)/S.E = 0.60-0.47 / 0.061 = 0.13 / 0.061 = 2.13 The value of test statistic or z score at a = 0.05 is 1.96 Since the calculated value (2.13) is greater than the critical value (1.96), at a=0.05, the null hypothesis will be rejected. In other words the test shows enough evidence to reject the findings of Robert Half International.

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