CAS Exam MAS-I Spring 2019, Question 22

Study guide: Exam MAS-I

Let X be a Bernoulli random variable with probability of success q. You want to perform the following hypothesis test:

• H_0\colon q = 0.75
• H_1\colon q > 0.75

We will reject H_0 in favor of H_1 if \sum_{i=1}^{30} X_i \ge k.

Calculate the smallest k such that significance level of this test will be at most 0.02.

• A) Fewer than 27
• B) 27
• C) 28
• D) 29
• E) At least 30

Answer this question and see the worked solution

Concepts tested

• Type I Error
• Hypothesis Testing
• Binomial Distribution
• Critical Value

More questions from this set

• CAS Exam MAS-I Spring 2019, Question 21
• CAS Exam MAS-I Spring 2019, Question 23