Question

A random sample of 400 voters in a certain city are asked if they favor an additional 4% gasoline tax to provide badly needed revenues for street repairs. If more than 220 but fewer than 260 favor the sales tax, we shall conclude that 60% of the voters are for it.a.) Find the probability of committing a type I error if 60% of the voters favor the increased tax.b.) What is the probability of committing a type II error using this test procedure if actually 48% of the voters are in favor of the additional gasoline tax?

Answer 1

Answer:

A) α = 0.04136

B) β = 0.00256

Step-by-step explanation:

We are given;

Sample size; n = 400

Proportion; p = 60% = 0.6

Formula for mean is;

μ = np

μ = 400 × 0.6 = 240

Standard deviation is given by;

σ = √npq

Where q = 1 - p = 1 - 0.6 = 0.4

σ = √(400 × 0.6 × 0.4)

σ = √96

σ = 9.8

A) our null hypothesis is at p = 0.6

Probability of making a type I error means we reject the null hypothesis when it is true.

This can be expressed in reference to the question as;

α = P(x < 220) + P(x > 260) all at p = 0.6

Now,

P(x < 220) = z = (x¯ - μ)/σ = (220 - 240)/9.8 = -2.04

Also;

P(x > 260) = z = (260 - 240)/9.8 = 2.04

Now, from z-distribution table probability of a z-score of -2.04 is 0.02068.

Also, probability of z-score of 2.04 is (1 - P(z < 2.04) = 1 - 0.97932 = 0.02068

Thus;

α = 0.02068 + 0.02068

α = 0.04136

B) Type II error occurs when we fail to reject the null hypothesis even though it's false.

In this case our alternative hypothesis is at p = 48% = 0.48

Thus;

μ = np

μ = 400 × 0.48 = 192

Standard deviation is given by;

σ = √npq

Where q = 1 - p = 1 - 0.48 = 0.52

σ = √(400 × 0.48 × 0.52)

σ = √99.84

σ = 9.992

Type II error would be given by;

β = [((x1¯ - μ)/σ) < z > ((x2¯ - μ)/σ)]

β = [((220 - 192)/9.992) < z > ((260 - 192)/9.992)]

β = (2.8 < z > 6.81)

Rearranging this gives us;

β = P(z < 6.81) - P(z < 2.8)

From z-distribution tables, we have;

β = 1 - 0.99744

β = 0.00256