A major credit card company is interested in whether there is a linear relationship between its internal rating of a customer’s credit risk and that of an independent rating agency. The company collected a random sample of 200 customers and used the data to test the claim that there is a linear relationship. The following hypotheses were used to test the claim.H0:β1=0Ha:β1≠0The test yielded a t-value of 3.34 with a corresponding p-value of 0.001. Which of the following is the correct interpretation of the p-value?If the alternative hypothesis is true, the probability of observing a test statistic at least as extreme as 3.34 is 0.001.If the alternative hypothesis is true, the probability of observing a test statistic at least as extreme as 3.34 is 0.001.AIf the alternative hypothesis is true, the probability of observing a test statistic of 3.34 or greater is 0.001.If the alternative hypothesis is true, the probability of observing a test statistic of 3.34 or greater is 0.001.BIf the null hypothesis is true, the probability of observing a test statistic of 3.34 or greater is 0.001.

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Description: A major credit card company is interested in whether there is a linear relationship between its internal rating of a customer’s credit risk and that of an independent rating agency. The company collected a random sample of 200 customers and used the

Explanation: When we perform hypothesis test in statistics The claim shall be in the alternative…

Answered: A major credit card company is…

MATLAB: An Introduction with Applications

6th Edition

ISBN:9781119256830

Author:Amos Gilat

Publisher:Amos Gilat

Chapter1: Starting With Matlab

Section: Chapter Questions

Problem 1P

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A major credit card company is interested in whether there is a linear relationship between its internal rating of a customer’s credit risk and that of an independent rating agency. The company collected a random sample of 200 customers and used the data to test the claim that there is a linear relationship. The following hypotheses were used to test the claim.

H0:β1=0Ha:β1≠0

The test yielded a t-value of 3.34 with a corresponding p-value of 0.001. Which of the following is the correct interpretation of the p-value?

If the alternative hypothesis is true, the probability of observing a test statistic at least as extreme as 3.34 is 0.001.

If the alternative hypothesis is true, the probability of observing a test statistic at least as extreme as 3.34 is 0.001.

A
If the alternative hypothesis is true, the probability of observing a test statistic of 3.34 or greater is 0.001.

If the alternative hypothesis is true, the probability of observing a test statistic of 3.34 or greater is 0.001.

B
If the null hypothesis is true, the probability of observing a test statistic of 3.34 or greater is 0.001.

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