This is a word problem that you must set up according to the five-step process. You will perform a statistical test by hand, giving your conclusions and providing recommendations for the company in the problem. You MUST use the rejection region approach, not the p-value approach.

 

The Steps: 1. State the null (H) and alternate (H2) hypotheses 2. a) Choose the test statistic b) Give the critical value 3. State the decision rule 4. Calculate the test statistic 5. a) State the conclusion (i.e., reject Ho or not) b) Tell what the conclusion means c) Recommend a course of action