A sample of 100 mortgages approved during the current year showed that 31 were i
ID: 2958354 • Letter: A
Question
A sample of 100 mortgages approved during the current year showed that 31 were issued to a single-earner family or individual. The historical average is 25 percent. (a) At the .05 level of significance in a right-tailed test, has the percentage of single-earner or individual mortgages risen? Include a sketch of your decision rule and show all work. (b) Is this a close decision? (c) State any assumptions that are required.Explanation / Answer
given all these, Null Hypothesis: P =0.25 Alternative Hypothesis:P>0.25 The test statistic isgiven by the critical value of 'z'at 0.05, the level of significance is 1.645. Since the calculated valueof 'z' is less than the critical vlaue of 'z' so we accept the nullhypothesis and conclude that the percentage of single earner orindividual mortagages are not risen. b) No it is not a closedecision and c) we assume that thisdata follows normal distribution