1.A medical insurance company wants to know whether the proportion of its customers requiring a hospital stay during a year will decrease if it provides coverage for certain types of alternative medicine. The company conducts a 1-year study in which it gives insurance coverage for alternative medicine to 5000 randomly selected customers. Using the data from this study, the company tests the following hypotheses about the effect of offering the alternative medicine coverage to its customers:

H₀ : proportion requiring a hospital stay will remain the same

H_a : proportion requiring a hospital stay will decrease

If the null hypothesis is rejected, the company will offer this coverage to all of its customers in the future.

(a)Explain what a Type I error would be in the context of the situation.

(b)Explain what a Type II error would be in the context of the situation.

(c)What are the consequences of making each type of error? Which error would be more serious for the customers, and why?