For Problem #1 above concerning the Federal grant: (A) What would be the consequ

Question

For Problem #1 above concerning the Federal grant: (A) What would be the consequence of making a Type I error? (B) What would be the consequence of making a Type II error?

Below is problem # 1. please do not answer problem #1. But answer the question above ^

1. In order to rule on a potential federal grant, a government official must confirm weather the average income in a Pennsylvania county is less than $12,500. A sample of 27 individuals is taken and shows a sample mean of $11,450 and a sample standard deviation of $2,972. Conduct the test at a 1% level of significance. What is your conclusion?

Explanation / Answer

A) Type I error would occur when we conclude that the average income in a Pennsylvania county is less than $12,500 whereas the actual average income was $12500. The consequences of that would be that they will incorrectly get the federal grant.

B) Type II error would occur when we conclude that the average income in a Pennsylvania county is $12,500 whereas the true average income was less than $12500. The consequence of this would be that they will miss the federal grant even when they met the eligibility criteria.

Related Questions

Navigate

• Browse (All)
• Browse F
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.