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Hypothesis testing

We analyze whether the true mean discharge of wastewater per hour from an industrial plant exceeds the company claims of 1000 gallons. For the decision in the one-sided test using a=0.05:

A) If the plant is not exceeding the limit, but actually the M=1000, there is only 5% chance that we will conclude that they are exceeding the limit.
B) If the plant is exceeding the limit, there is only a 5% chance that we will conclude that they are not exceeding the limit.
C) The probability that the sample mean equals exactly the observed value would equal 0.05 if H0 was true.
D) If we reject the H0, the probability that it is actually true is 0.05.
E) All the above

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Solution Summary

Solution selects the right choice for the claim made. It also explains why it has been choosen.

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