Ads: A company is willing to renew itadvertising contact with a local radio station only if the stationcan prove that more than 20% of the residents of the city heard thead and not recognize the company’s product. The radio stationconducts a random phone survey of 400 people.
A) What are the hypotheses
B) The station plans to conduct this test using a 10%level of significance, but the company wants the significance levellowered to 5%?
C) What is meant by the power of the test?
D) For which level of significance will the power of thetest be higher? Why?
E) They finally agree to use a = 0.05, but the companyproposes that the station call 600 people instead of the 400initially proposed. With that make the risk of Type II error higheror lower? Explain
