N3

A resident of Bayport claims to the City Council that the proportion of Westside residents (1) with income below the poverty level is lower than the proportion of Eastside residents (2). The City Council decides to test this claim by collecting a random sample of resident incomes from the Westside of town and a random sample of resident incomes from the Eastside of town. A total of 78 out of 578 Westside residents had an income below the poverty level and Hundred-and-twenty out of 714 Eastside residents had an income below the poverty level. a. Specify the hypotheses. b. What is the test statistic and p-value? Round to 3 decimal places. c. At the 5% significance level, what is the decision and conclusion to this test?