One claim states the IRS conducts audits for not more than 5 percent of total tax returns each year. In order to test this claim statistically, the appropriate null and alternative hypotheses are: H0 : μ ≤ 0.05 Ha : μ 0.05

Question

One claim states the IRS conducts audits for not more than 5 percent of total tax returns each year. In order to test this claim statistically, the appropriate null and alternative hypotheses are: H0 : μ ≤ 0.05 Ha : μ > 0.05

Quizplus · Accepted Answer

The correct null hypothesis should state the condition of equality or the status quo, which in this case is that the IRS audits at most 5 percent of total tax returns each year, so H0 should be μ = 0.05. The alternative hypothesis should reflect the claim being tested, which is that more than 5 percent of tax returns are audited, so Ha : μ > 0.05 is correct. However, the null hypothesis as presented (H0 : μ ≤ 0.05) incorrectly includes conditions both equal to and less than 5 percent, which is not appropriate for testing the specific claim that more than 5 percent are audited.

One Claim States the IRS Conducts Audits for Not More