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Economists often track employment trends by measuring the proportion of people who are underemployed, meaning they are either unemployed or would like to work full
Economists often track employment trends by measuring the proportion of people who are "underemployed," meaning they are either unemployed or would like to work full time but are only working part-time. In the summer of 2013, 17.6% of Americans were "underemployed." The mayor of Thicksburg wants to show the voters that the situation is not as bad in his town as it is in the rest of the country. His staff takes a simple random sample of 300 Thicksburg residents and finds that 45 of them are underemployed. (a) Do the data give convincing evidence that the proportion of underemployed in Thicksburg is different than elsewhere in the country? Support your answer with a significance test. Use a = 0.10. (b) Instead of performing the hypothesis test, you want to construct a confidence interval. What would be the confidence level so that it is equivalent to the hypothesis test in part (a)? Explain. (c) Would 17.6% be a value in the interval constructed in part (b)? Explain
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