Answer:
(a) At 5% significance level, reject H0
At 1% significance level, reject H0
(b) At 5% significance level, fail to reject H0
At 1% significance level, fail to reject H0
Step-by-step explanation:
(a) The test is a one tailed test
At 5% significance level, the critical value is 1.645
Conclusion: Reject H0 because the test statistic -1.78 is less than the critical value 1.645
At 1% significance level, the critical value is 2.326
Conclusion: Reject H0 because the test statistic -1.78 is less than the critical value 2.326
(b) The test is a two tailed test
At 5% significance level, the critical value is 1.96. The region of no rejection of H0 lies between -1.96 and 1.96
Conclusion: Fail to reject H0 because the test statistic -1.78 falls within -1.96 and 1.96
At 1% significance level, the critical value is 2.576. The region of no rejection of H0 lies between -2.576 and 2.576
Conclusion: Fail to reject H0 because the test statistic falls within -2.576 and 2.576
