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The actual test begins by considering two hypotheses . They are called the null hypothesis and the alternate hypothesis . These hypotheses contain opposing viewpoints.

H o : The null hypothesis: It is a statement about the population that will be assumed to be true unless it can be shown to be incorrect beyond a reasonable doubt.

H a : The alternate hypothesis: It is a claim about the population that is contradictory to H o and what we conclude when we reject H o .

H o : No more than 30% of the registered voters in Santa Clara County voted in the primary election.

H a : More than 30% of the registered voters in Santa Clara County voted in the primary election.

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We want to test whether the mean grade point average in American colleges is different from 2.0 (out of 4.0).

H o : μ = 2.0 H a : μ 2.0

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We want to test if college students take less than five years to graduate from college, on the average.

H o : μ 5 H a : μ 5

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In an issue of U. S. News and World Report , an article on school standards stated that about half of all students in France, Germany, and Israel take advanced placementexams and a third pass. The same article stated that 6.6% of U. S. students take advanced placement exams and 4.4 % pass. Test if the percentage of U. S. students who take advancedplacement exams is more than 6.6%.

H o : p = 0.066 H a : p > 0.066

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Since the null and alternate hypotheses are contradictory, you must examine evidence to decide if you have enough evidence to reject the null hypothesis or not. The evidence is in the form of sample data.

After you have determined which hypothesis the sample supports, you make a decision. There are two options for a decision. They are "reject H o " if the sample information favors the alternate hypothesis or "do not reject H o " or "fail to reject H o " if the sample information is insufficient to reject the null hypothesis.

Mathematical Symbols Used in H o and H a :

H o H a
equal ( = ) not equal ( ) or greater than ( > ) or less than ( )
greater than or equal to ( ) less than ( )
less than or equal to ( ) more than ( > )

H o always has a symbol with an equal in it. H a never has a symbol with an equal in it. The choice of symbol depends on the wording of the hypothesis test. However, be aware that many researchers (including one of the co-authors in research work) use = in the Null Hypothesis, even with > or < as the symbol in the Alternate Hypothesis. This practice is acceptable because we only make the decision to reject or not reject the Null Hypothesis.

Optional collaborative classroom activity

Bring to class a newspaper, some news magazines, and some Internet articles . In groups, find articles from which your group can write a null and alternate hypotheses. Discuss yourhypotheses with the rest of the class.

Questions & Answers

it is the relatively stable flow of income
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what is Flexible exchang rate?
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is gdp a reliable measurement of wealth
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introduction to econometrics
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Why is unemployment rate never zero at full employment?
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bcoz of existence of frictional unemployment in our economy.
Umashankar
what is flexible exchang rate?
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due to existence of the pple with disabilities
Abdulraufu
the demand of a good rises, causing the demand for another good to fall
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is it possible to leave every good at the same level
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I don't think so. because check it, if the demand for chicken increases, people will no longer consume fish like they used to causing a fall in the demand for fish
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is not really possible to let the value of a goods to be same at the same time.....
Salome
Suppose the inflation rate is 6%, does it mean that all the goods you purchase will cost 6% more than previous year? Provide with reasoning.
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Not necessarily. To measure the inflation rate economists normally use an averaged price index of a basket of certain goods. So if you purchase goods included in the basket, you will notice that you pay 6% more, otherwise not necessarily.
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discus major problems of macroeconomics
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Economic growth Stable prices and low unemployment
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what is inflation
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increase in general price levels
WEETO
Good day How do I calculate this question: C= 100+5yd G= 2000 T= 2000 I(planned)=200. Suppose the actual output is 3000. What is the level of planned expenditures at this level of output?
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Criteria for determining money supply
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Aggregate demand
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C=k100 +9y and i=k50.calculate the equilibrium level of output
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it must be .9 or 0.9 no Mpc is greater than 1 Y=100+.9Y+50 Y-.9Y=150 0.1Y/0.1=150/0.1 Y=1500
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hi can someone help me on this question If a negative shocks shifts the IS curve to the left, what type of policy do you suggest so as to stabilize the level of output? discuss your answer using appropriate graph.
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if interest rate is increased this will will reduce the level of income shifting the curve to the left ◀️
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Source:  OpenStax, Collaborative statistics. OpenStax CNX. Jul 03, 2012 Download for free at http://cnx.org/content/col10522/1.40
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