2. To investigate an alleged unfair trade practice, the FTC takes a random sampl

Question

2. To investigate an alleged unfair trade practice, the FTC takes a random sample of 16 "5-ounce" candy bars. The mean of the sample weights is 4.85 ounces, and the sample standard deviation is .1 ounce. Test the hypotheses: At the 5% significance level. Assume the population of candy bar weights is approximately normally distributed. Bases on the results, does the FTC have grounds to proceed against the manufacturer for unfair practice of short-weight selling? Yes No Cannot tell from this information

Explanation / Answer

here for 5% level and left tailed test with (n-1=15) degree of freedom ; critical value of t =1.753

rejection region:reject Ho if test statistic t<-1.753

std error of mean =std deviation/(n)1/2 =0.1/(16)1/2 =0.025

therfore test statitic t=(X-mean)/std error =(4.85-5)/0.025=-6

as test statistic is less then critical value we reject null hypothesis and coclude that weight is less then 5 pounds

Hence Yes ; FTC have grounds to proceed agains the manufacturer for unfair practice

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