A major DVD rental chain is considering opening a new store in an area that currently does not have any such stores. The chain will open if there is evidence that more than 5,000 of the 20,000 households in the area are equipped with DVD players. It conducts a telephone poll of 300 randomly selected households in the area and finds that 96 have DVD players. The p-value associated with the test statistic in this problem is approximately equal to
A) 0.0100.
B) 0.0051.
C) 0.0026.
D) 0.0013.

Question

Quizplus · Accepted Answer

The sample proportion is 96/300 = 0.32. The null hypothesis is that the proportion of households with DVD players is 0.25 (5,000 out of 20,000). Using a z-test for proportions, the test statistic is calculated, and the p-value is approximately 0.0026.

A Major DVD Rental Chain Is Considering Opening a New