Question 5. need answers After test-marketing a new product, a restaurant chain

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Question 5. need answers

After test-marketing a new product, a restaurant chain concluded that introduction of the product nationwide would increase its sales by more than 24%. This conclusion was based on recording sales information for a random sample of its restaurants selected for the marketing trial. With denoting the mean percentage increase in sales for all its restaurants, consider using the sample data to decide between H0 : = 24 and Ha : > 24.

(a) Is the restaurant chain's conclusion consistent with a decision to reject H0 or to fail to reject H0?

Choice A: Reject H0

Choice B: Fail to reject H0    

(b) If the restaurant is incorrect in its conclusion, is the company making a Type I or a Type II error?

Choice A: Type I error

Choice B: Type II error    

Explanation / Answer

a)as its claim is consitent with mean >24 hence

Choice A: Reject H0

b)as rjecting null when it is true is called type I error

Choice A: Type I error

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