A manager for an insurance company believes that customers have the following pr

Question

A manager for an insurance company believes that customers have the following preferences for life insurance products: 30% prefer Whole Life, 20% prefer Universal Life, and 50% prefer Life Annuities. The results of a survey of 230 customers were tabulated. Is it possible refuting the sales manager's claimed proportions of customers who prefer each product using the data? Step 2 of 10: What does the null hypothesis indicate about the proportions of customers who prefer each insurance product? The proportions of customers who prefer each insurance product are all thought to be equal. The proportions of customers who prefer each insurance product are different for each category (and equal to the previously accepted values).

Explanation / Answer

Null hypotheses, in general, are expected to defend the status quo. Therefore, the answer to the quesiton should be the latter, that is,

The proportions of customers who prefer each insurance product are different for each category (and equal to the previously accepted values)

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