# Hypothesis Testing

2. A Wall Street Journal article suggests that age bias is becoming an even bigger problem in the corporate world. In 2001, an estimated 78% of executives believed that age bias was a serious problem. In a 2004 study by ExecuNet, 82% of the executives surveyed considered age bias a serious problem. The sample size for the 2004 study was not disclosed. Suppose 50 executives were surveyed.

a. At the .05 level of significance, is there evidence that the proportion of executives who believed age bias was a serious problem increased between 2001 and 2004, that is, is there evidence that the proportion of executives who believed age bias to be a serious problem in 2004 is greater than 78%?

Complete the following:

1. State H0.

2. State H1.

3. State the value of I±.

4. State the value of the test statistic.

5. State the p-value.

6. State the decision in terms of H0 and why.

7. State the decision in terms of the problem.

b. Explain the meaning of the p-value in this problem.

c. Suppose the sample size used was 1000. Does that change the conclusion you reached in part (a)? How?

d. Discuss the effect that sample size had on the outcome of this analysis and, in general, on the effect sample size plays in hypothesis-testing.

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#### Solution Summary

The validity of tests with differences in sample sizes are provided. A Complete, Neat and Step-by-step Solution is provided in the attached file.