The dollar price of a 1,000.00 face value bond is 991.25. this bond is listed at...
2 answers:
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Answer: The probability of rejecting the null hypothesis, when it is true, is 5%.
Step-by-step explanation:
We know that the level of significance ( denoted as ) is generally the probability of rejecting the null hypothesis when it is true.
Therefore , If the level of significance (\alpha[/tex] ) 0.05, then it means that it is the probability of rejecting the null hypothesis when it is true.
i.e. The probability of rejecting the null hypothesis when it is true= 0.05
In percent :
Hence, the correct option is : The probability of rejecting the null hypothesis when it is true is 5%.