(1) We are conducting many hypothesis tests to test a claim. Assuming the null hypothesis is true, approximately how many of the 200 tests, using a signicance level of 5%, will incorrectly nd signicance? (2) For the situation described below, indicate whether it makes more sense to use a relatively large signicance level (such as o: = 0.10) or a relatively small signicance level (such as a = 0.01). Testing to see if a large investment rm is participating in the illegal prac- tice of insider trading. If there is evidence, the Securities and Exchange Commission will le a lawsuit against them. (3) Dropouts The National Center for Education Statistics reports that the high school dropout rate is 5.3%. Due to tougher standards and high-stakes tests, teachers in New York State believe that the high school dropout rate in New York State differs from the national rate. (a) Dene the relevant parameter and state the null and alternative hypothesis. (b) The teachers select a random sample and construct a 95% condence interval of (0.049, 0.061). Using the condence interval, what is the conclusion of the test? Include an indication of the signicance level. (c) State the conclusion of test in context