Determine the probability and power curve, Macroeconomics

Assignment Help:

Learning Objective: Reinforce understanding of Power, β, and α.

Problem: A packing process is designed to fill steel drums with 400 pounds of a chemical. To determine whether or not the process is working properly, a significance test has been designed. The null and alternative hypotheses are:

H0: μ = 400

Ha: μ ≠ 400

where μ is the average amount of chemical filled in the drums. It is decided to reject H0 if the average weight of a random sample of 36 drums is less than 390 pounds or if the average weight of a random sample of 36 drums is greater than 410 pounds. Assume that the population standard deviation is equal to 42, and that the drum fill weights are normally distributed.

Requirements:

1. Determine the probability (rounded to 2 decimal places) of committing a Type I error for this decision rule? Include all calculations in your submission report.

2. Create a power curve for this decision rule using the following alternate values for μ:

375, 380, 385, 390, 395, 400, 405, 410, 415, 420, 425. Include any manual calculations you do in the assignment submission.

3. Provide specific advice for modifying the test to ensure both of the following

a. a maximum probability of Type I error equal to 0.05

b. a maximum probability of Type II error equal to 0.15 when the mean amount of chemical in the drums is actually 410 pounds.


Related Discussions:- Determine the probability and power curve

Describe the goods in the circular flow, Goods in the circular flow ...

Goods in the circular flow If Y R is total value of all goods going from F R to F H , then total value added from all firms in the F R box is equal to Y R (they don't pu

Money demand function, Assume that the money demand function is (M/P) d = 2...

Assume that the money demand function is (M/P) d = 2,200 - 200r, where r is the interest rate in percent. The money supply M is 2,000 and the price level P is2. If the price level

Peers for a country, What are the best criteria to select peers for a count...

What are the best criteria to select peers for a country ?

IS-LM, THE PRODUCT MARKET Z=C+I+G C=a+bYd I=Io+I1Y-I2i Equilibrium conditio...

THE PRODUCT MARKET Z=C+I+G C=a+bYd I=Io+I1Y-I2i Equilibrium condition, Y=Z, where Y represents output and Z is aggregate spending. THE FINANCIAL MARKET Md=MT+Mp MT=MTo+MT1Y Mp=Mpo

Explain about a model and use of it in economics, Explain about a model and...

Explain about a model and use of it in economics. A model is a simplified demonstration of a real situation which is used to better understand real-life circumstances. The

What is consumption?, "Consumption" is an old name for tuberculosis (TB) th...

"Consumption" is an old name for tuberculosis (TB) that explains how the illness wastes away or consumes its victims. TB is "an ancient enemy" that has plagued human kind for more

Equilibrium and disequilibrium, Equilibrium and Disequilibrium  In phys...

Equilibrium and Disequilibrium  In physical sciences, equilibrium is a state of balance between opposing forces or actions. The meaning of equilibrium in economic theory is exa

Financial Crises, #question. BANK Z (@ 10% RR) ASS...

#question. BANK Z (@ 10% RR) ASSETS LIABILITIES RR: K200,000 Deposits : K2,000,000 ER : K1,800,000 You are given the above Balance sheet for Bank Z as

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd