Q4 Part A The manager at Costello Drug Store assumes the Com

Q4.

(Part A): The manager at Costello Drug Store assumes the Company’s employees are honest. However, there have been some shortages from the cash register lately. There is only one employee who could have taken money from the register during the last periods. Realizing that shortages might have resulted from employee inadvertently giving incorrect changes to customers, the employer does not know whether to forget the situation or accuse the employee of theft. In words,

(a). What are the null and alternative hypotheses? (4 pts)

(b). What constitute a Type I error in this problem? (3 pts)

(b). What constitute a Type II error in this problem? (3 pts)

(Part B): A new internet provider claims that using their system you can get transmission speeds of 400 Kilobits per second

(a). Specify , both mathematically and in English, the null and the alternative hypotheses a potential customer should investigate if she is worried that the connection is really slower than advertised. Explain your reasoning. (5 pts)

(b).

(i). The system was tested on a sample of 100 computers and the average connection speed is found to be far below 400 Kilobits. What hypothesis should probably be rejected? Explain. (2.5 pts)

(ii). If the customer needs a connection speed of 400 Kilobits to run her business application programs, what do you think she would do with regards to the purchase of the service from the internet provider? (2.5 pts)

(c). How would your answers to (a) be if you were looking at the problem from the internet provider’s point of view and wanted to prove to potential customers that their system was good? (5 pts)

Solution

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