Hypothesis Testing Hypothesis testing typically begins with a theory, a claim, o
ID: 3298013 • Letter: H
Question
Hypothesis Testing Hypothesis testing typically begins with a theory, a claim, or an assertion about a particular parameter (mean or proportion) of a population. The Federal Trade Commission (FTC) is an independent agency of the U.S. federal government charged with preventing unfair or deceptive trade practices. It regulates advertising, marketing, and consumer credit practices, and also prevents antitrust agreements and other unfair practices. The FTC publishes press releases regularly about health and fitness claims at
https://www.ftc.gov/news-events/media-resources/truth-advertising/health-claims Health and Fitness Claims.
Retrieved from https://www.ftc.gov/news-events/media-resources/truth-advertising/health-claims
Find a claim about a product or service from one of the press releases listed in the FTC website above. Read through these and select one of interest to you. Initial Response: Formulating the Hypothesis Summarize the advertising claim as shared in the media. What population parameter is the claim about? (Hint: Focus on a population mean or proportion, such as the mean weight of a cereal box, or the proportion of fast-food orders filled correctly.) If you were to formulate a hypothesis test about this product/service, what would your null and alternative hypothesis be? (Be sure to use all the correct notations for Ho and Ha.) State whether you have a one-tailed or two-tailed test (Be sure you use the correct inequality signs).
The claim that I found on the website and am using is:
The Federal Trade Commission, through an administrator, is mailing 449,044 claim forms to consumers who may have lost money after buying LeanSpa, a supplement whose marketers allegedly made deceptive weight loss claims. The claim forms are intended to help determine which consumers are eligible for refunds.
The FTC and the state of Connecticut sued the marketers of LeanSpa in December 2011, charging that they used fake websites to promote acai berry and “colon cleanse” weight-loss products, and that they falsely told consumers that they could receive free trials by paying a nominal cost for shipping and handling. In reality, consumers ended up paying $79.95 for the trial, and for recurring monthly shipments of the product that were hard to cancel. The defendants settled the complaint in January 2014, agreeing to stop making the claims and surrender assets valued at approximately $5.7 to $7 million for consumer refunds.
The claim forms will be mailed to consumers by Rust Consulting, Inc., an administrator working for the FTC. Consumers receiving forms will have 60 days to submit their claims online or by mail, following the instructions on the form. Consumers who lost money after buying LeanSpa, but do not receive a claim form, can still submit a complaint with the FTC using the FTC’s Complaint Assistant or toll-free number below.
Consumers with additional questions about the LeanSpa case or the claim form process can call the administrator toll-free number at 1-866-621-4156 or visit the FTC’s LeanSpa case web page. Using this information, the FTC will determine which consumers are eligible for refunds and how much they should receive. No refund checks are being mailed at this time.
The FTC urges consumers to carefully evaluate advertising claims for weight-loss products. For more information on how to avoid weight-loss scams, see the agency’s guidance for consumers of products and services advertised for Weight Loss & Fitness. The FTC also has guidance for media outlets on spotting false weight-loss claims in advertising.
Explanation / Answer
Hypothesis testing determines if all the 449044 claims are reunded or less than that!
H0: number of claims refunded = 449044
Ha: number of claims refunded < 449044
Looking at the normal curve and trying to shade the region we find that this is a left tailed hypothesis!
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