Answer:
Conclusion: The proportion of customers satisfied with the service they receive from the large electric utility company is different from 80%, the claim made by the CEO.
Step-by-step explanation:
To test the claim made by the CEO of a large electric utility company the newspaper must conduct a hypothesis test for one proportion.
<u>Assumption</u>:
The significance level (<em>α</em>) of the test can be assumed to be 5%.
<u>Hypothesis</u>:
The proportion of customers satisfied with the service they receive is 0.80, i.e.
The proportion of customers satisfied with the service they receive is different from 0.80, i.e.
<u>Decision Rule</u>:
If the <em>p</em>-value of the test is less than the significance level (<em>α</em>) then the null hypothesis may be rejected. But if the <em>p</em>-value is more than the significance level (<em>α</em>) then we cannot reject the null hypothesis.
<u>Test Statistics:</u>
As the sample size is large, i.e.<em>n</em> = 100 > 30, then according to the central limit theorem sampling distribution of sample proportion will follow the normal distribution.
The test statistic used is:
<u>Given</u>:
The <em>p</em>-value of the hypothesis test is computed to be 0.894.
That is:
This implies that we fail to reject the null hypothesis at 5% level of significance.
<u>Conclusion</u>:
The null hypothesis was failed to be rejected at 5% level of significance.
Thus, concluding that the proportion of customers satisfied with the service they receive from the large electric utility company is different from 80%, the claim made by the CEO.
