The executives of CareFree Insurance, Inc.feel that "a majority of our employees perceive a participatory management style at CareFree." A random sample of 200 CareFree employees is selected to test this hypothesis at the 0.05 level of significance.Ninety employees rate the management as participatory.The appropriate decision is to __________.
A)fail to reject the null hypothesis
B)reject the null hypothesis
C)reduce the sample size
D)increase the sample size
E)maintain status quo

Question

Quizplus · Accepted Answer

To determine whether to reject the null hypothesis, we typically calculate a test statistic and compare it to a critical value corresponding to the 0.05 level of significance. Without specific details on the expected proportion under the null hypothesis, we can't calculate the exact test statistic here. However, the decision to "fail to reject the null hypothesis" suggests that the evidence from the sample (90 out of 200 employees rating management as participatory) was not strong enough to conclude that a majority of employees perceive a participatory management style, at least not with a high level of statistical significance. This decision does not imply that the hypothesis is true, only that there is not enough evidence to reject it based on the sample data provided.

The Executives of CareFree Insurance, Inc