Duke Energy reported that the cost of electricity for an efficient home in a par

Question

Duke Energy reported that the cost of electricity for an efficient home in a particular neighborhood of Cincinnati, Ohio was $109 per month. A researcher believes that the cost of electricity for a comparable neighborhood in Chicago, Illinois is higher. A sample of homes in this Chicago neighborhood will be taken and the sample mean monthly cost of electricity will be used to test the following null and alternative hypotheses.

H0:    109
Ha: > 109

a. Assume the sample data lead to rejection of the null hypothesis. What would be your conclusion about the cost of electricity in the Chicago neighborhood?

SelectCost of electricity in Cincinnati is higher. Cost of electricity in Chicago is higher. There is no statistically significant difference between the cost of electricity in Cincinnati and Chicago. Item 1

b. What is the Type I error in this situation?

The Type I error is - Select your answer -acceptingrejectingItem 2 H0 when it is - Select your answer -truefalseItem 3 .

What are the consequences of making this error?

SelectA type I error is rejecting the null and assuming Chicago has higher electricity costs than Cincinnati, when you should accept the null because they actually have lower than or equal electricity costs than Cincinnati. A type I error is accepting the null and assuming Chicago has lower than or equal electricity costs than Cincinnati, when you should reject the null because they actually have higher electricity costs than Cincinnati. A type I error is rejecting the null and assuming Chicago has lower than or equal electricity costs than Cincinnati, when you should reject the null because they actually have higher electricity costs than Cincinnati. A type I error is accepting the null and assuming Chicago has higher electricity costs than Cincinnati, when you should reject the null because they actually have lower than or equal electricity costs than Cincinnati. Item 4

c. What is the Type II error in this situation?

The Type II error is - Select your answer -acceptingrejectingItem 5 H0 when it is - Select your answer -truefalseItem 6 .

What are the consequences of making this error?

Explanation / Answer

null and alternative hypotheses.

H0:    109
Ha: > 109

A)

As Ho is rejected, then we conclude that the mean cost of electricity in Illinois is higher than that of Cincinnati.

b)

A Type I error is incorrectly rejecting Ho when it is true.

Here, a type 1 error is concluding that the mean cost of electricity in Illinois is higher than that of Cincinnati, when in fact, it is not.

c)

A Type II error is incorrectly failing to reject Ho when it is false.

if we conclude that cost of electricity in Chicago is not significantly higher than Cincinnati, when it is actually higher. Type-II error is comparatively less fatal than Type-I error, although it will also result in incorrect conclusion.

Hope this will be helpful. Thanks and God Bless you :-)

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