Question

Robin Inc. feared that the average company loss is running beyond $34,000. It initially conducted a hypothesis test on a sample extracted from its database. The hypothesis was formulated as H0: average company loss ≤ $34,000 H1: average company loss > $34,000. The test resulted in favor of Robin Inc.'s loss not exceeding $34,000. Detailed study of company accounts later revealed that the average company loss had run up to $37,896. Which of the following errors were made during the hypothesis test? Select one: a) Type III error b) Type II error c) Type I error d) Type IV error

Answer 1

Answer

b. Type II error

Step-by-step explanation:

The hypothesis was formulated as  

the solution can be seen in the attached document