A law firm is trying to decide whether to represent car owners in a class action lawsuit against the manufactur of a certain make and model for a particular defect. If 5 percent or less of the cars of this make and model hav the defect, the firm will not recover its expenses. Therefore, the firm will handle the lawsuit only if it is convinced that more than 5 percent of cars of this make and model have the defect. The firm plans to take a random sample of 1000 people who bought this car and ask them if they experienced this defect in their cars. State the null and alternative hypotheses that the law firm should test.

MATLAB: An Introduction with Applications
6th Edition
ISBN:9781119256830
Author:Amos Gilat
Publisher:Amos Gilat
Chapter1: Starting With Matlab
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When a law firm represents a group of people in a class action lawsuit and wins that lawsuit, the firm receives a
percentage of the group's monetary settlement. That settlement amount is based on the total number of
people in the group - the larger the group and the larger the settlement, the more money the firm will receive.
A law firm is trying to decide whether to represent car owners in a class action lawsuit against the manufacturer
of a certain make and model for a particular defect. If 5 percent or less of the cars of this make and model have
the defect, the firm will not recover its expenses. Therefore, the firm will handle the lawsuit only if it is
convinced that more than 5 percent of cars of this make and model have the defect. The firm plans to take a
random sample of 1000 people who bought this car and ask them if they experienced this defect in their cars.
State the null and alternative hypotheses that the law firm should test.
Transcribed Image Text:When a law firm represents a group of people in a class action lawsuit and wins that lawsuit, the firm receives a percentage of the group's monetary settlement. That settlement amount is based on the total number of people in the group - the larger the group and the larger the settlement, the more money the firm will receive. A law firm is trying to decide whether to represent car owners in a class action lawsuit against the manufacturer of a certain make and model for a particular defect. If 5 percent or less of the cars of this make and model have the defect, the firm will not recover its expenses. Therefore, the firm will handle the lawsuit only if it is convinced that more than 5 percent of cars of this make and model have the defect. The firm plans to take a random sample of 1000 people who bought this car and ask them if they experienced this defect in their cars. State the null and alternative hypotheses that the law firm should test.
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