An investigator analyzed the leading digits from 761 checks issued by seven suspect companies. The frequencies were found to be 3, 15, 3, 61, 252, 386, 5, 20, and 16, and those digits correspond to the leading digits of 1, 2, 3, 4, 5, 6, 7, 8, and 9, respectively. If the observed frequencies are substantially different from the frequencies expected with Benford's law shown below, the check amounts appear to result from fraud. Use a 0.025 significance level to test for goodness-of-fit with Benford's law. Does it appear that the checks are the result of fraud?

Leading Digit	1	2	3	4	5	6	7	8	9
Actual Frequency	3	15	3	61	252	386	5	20	16
Benford's Law: Distribution of Leading Digits	30.1%	17.6%	12.5%	9.7%	7.9%	6.7%	5.8%	5.1%	4.6%

The null and alternative hypotheses:

H0: The leading digits are from a population that conforms to Benford's law.

H1: At least one leading digit has a frequency that does not conform to Benford's law.

QUESTIONS:

1. Calculate the test statistic X2? (Round to three decimal place as needed.)

2. Calculate the P-value? (Round to four decimal place as needed.)

3. State the conclusion? (Reject or Fail to reject)

______________H0. There _________ sufficient evidence to warrant rejection of the claim that the leading digits are from a population with a distribution that conforms to Benford's law. It _______ that the checks are the result of fraud.