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A survey of $225$ randomly selected students from a city revealed that $89.4 \%$ of them have participated in extracurricular activities in their schools.

WHAT IS THE CORRECT CONCLUSION AT THE 1\% LEVEL OF SIGNIFICANCE?

Information: Let $F_Z(x)$ be the cumulative distribution function (CDF) for the standard normal variable $Z$, i.e., $F_Z(x)=P(Z \leq x)$. You may use the following value

Note: $F_Z(-2.58)=0.005$

  1. THERE IS NO SUFFICIENT EVIDENCE TO REJECT THE CLAIM THAT 90\% OF STUDENTS PARTICIPATED.
     
  2. THERE IS SUFFICIENT EVIDENCE TO CONCLUDE THAT THE TRUE PERCENTAGE IS NOT $90 \%$.
     
  3. THERE IS SUFFICIENT EVIDENCE TO CONCLUDE THAT THE TRUE PERCENTAGE IS LESS THAN $90 \%$.
     
  4. THERE IS SUFFICIENT EVIDENCE TO CONCLUDE THAT THE TRUE PERCENTAGE IS EXACTLY $89.4 \%$.

1 Answer

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Null hypothesis, $H_0: p=0.9$

Alternate hypothesis, $H_A: p \neq 0.9$

Given, $\alpha=0.01$ and $n=225$

$$
\begin{gathered}
\alpha=P(|\bar{X}-p|>c \mid \mu=0.9) \\
\alpha=P\left(\left|\frac{\bar{X}-0.9}{\sqrt{\frac{0.9 \times 0.1}{225}}}\right|>\frac{c}{\sqrt{\frac{0.9 \times 0.1}{225}}}\right) \\
\alpha=P\left(|z|>\frac{c}{\sqrt{\frac{0.9 \times 0.1}{225}}}\right) \\
0.01=2 F_z\left(\frac{-15 c}{\sqrt{0.9 \times 0.1}}\right) \\
c=-\frac{\sqrt{0.9 \times 0.1}}{15} \times F_z^{-1}(0.005)=0.0516
\end{gathered}
$$


Since $|\bar{X}-p|=|0.894-0.9|<c, z$-test at significance level $(\alpha)=0.01$, will accept $H_0$.

Hence A is correct

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