Assume that the two-sided 95% confidence interval for the effect of a price on amount of beef purchased is between 0.30 and 0.38. Which of the following statements is incorrect?
A) We will reject the null hypothesis that this coefficient equals zero.
B) There is less than a 2.5% chance that a coefficient higher than 0.38 would produce the coefficient we actually observe.
C) There is a 95% chance that the true coefficient is between 0.30 and 0.38.
D) There is a 95% chance that a random sample will produce a confidence interval that includes the true coefficient.

Question

Quizplus · Accepted Answer

A confidence interval indicates the range within which we can be confident that the true parameter lies, given our sample data. It does not imply that the true coefficient has a specific probability of being within that range. Instead, it means that if we were to repeat the experiment many times, 95% of the confidence intervals calculated from those experiments would contain the true coefficient.

Assume That the Two-Sided 95% Confidence Interval for the Effect