1. Generally speaking, the null hypothesis is set up for the purpose of either accepting (failing to reject) it or rejecting it. (True or False?)

2. If the null hypothesis states that there is no difference between the mean income of males and the mean income of females, and the alternate hypothesis states that there is a difference in the mean income of males and females, then the test is one-tailed. (True or False?)

3. To set up a “decision rule,” the test distribution is divided into two regions – a region of “acceptance” for the null hypothesis and a region of “rejection” for the null hypothesis. (True or False?)

4. What is the “level of significance?” a. Probability of a Type II error b. Probability of a Type I error c. z-value of 1.96 d. Beta error e. None of these

5. The Student t-distribution has a greater spread than the z-distribution. As a result, a critical values of t for a given level of significance are smaller in magnitude than the corresponding z critical values. (True or False?)

6. Suppose a t- test is being applied to find out if the population monthly expenditure mean is less than $212. The level of significance selected is 1% and 26 accounts are sampled. What is the critical value? a. 2.580 b. -2.485 c. -1.960 d. -2.787 e. None of these

•7. The MacBurger restaurant chain claims that the waiting time of customers for service is normally distributed, with a mean of 3 minutes and a standard deviation of 1 minute. The quality-assurance department found in a sample of 50 customers at the Warren Road MacBurger that the mean waiting time was 2.75 minutes. At the 0.05 significance level, can we conclude that the mean waiting time at the Warren Road MacBurger is less than 3 minutes? (Show all steps in the hypothesis testing process if you wish to obtain full credit.)

•8. The National Safety Council reported that 52 percent of American turnpike drivers are men. A sample of 300 cars traveling southbound on the New Jersey Turnpike yesterday revealed that 170 were driven by men. At the 0.01 significance level, can we conclude that a larger proportion of men were driving on the New Jersey Turnpike that the national statistics indicate? (Show all steps in the hypothesis testing process if you wish to obtain full credit.)