A tax preparation company randomly selects 300 adults and asks them how they pre
ID: 3314685 • Letter: A
Question
A tax preparation company randomly selects 300 adults and asks them how they prepare their taxes. The results are shown at the right. Find the expected frequency for each tax preparation method. Perform a chi-square goodness-of-fit test to test whether the distributions are different. Use = 0.01.
Tax Preparation method
% of people
Observed frequency
Expected frequency
Accountant
25%
71
By hand
20%
40
Computer software
35%
101
Friend/family
5%
35
Tax preparation service
15%
53
Tax Preparation method
% of people
Observed frequency
Expected frequency
Accountant
25%
71
By hand
20%
40
Computer software
35%
101
Friend/family
5%
35
Tax preparation service
15%
53
Explanation / Answer
Ans:
H0:the distributions are equal.
Ha: the distributions are different.
Test statistic:
calculated chi square score=35.121
df=5-1=4
p-value=CHIDIST(35.121,4)=0
As,p-value<0.01,we reject null hypothesis.
There is sufficient evidence to conclude that the distributions are different.
Tax Preparation method % of people Observed frequency Expected frequency (O-E)^2/E Accountant 25% 71 75 0.213 By hand 20% 40 60 6.667 Computer software 35% 101 105 0.152 Friend/family 5% 35 15 26.667 Tax preparation service 15% 53 45 1.422 Total 100% 300 300 35.121Related Questions
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