All drugs must be approved by the U.S. Food and Drug Administration (FDA) before they can be
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d. Suppose, using standard medical treatment, that the mortality rate (r) of a certain disease is known to be
A. A manufacturer submits for approval a drug that is supposed to treat this disease. The FDA sets up the hypothesis to test the mortality rate for the drug as (1) Ho: r = A, Ha: r < A, a = 0.005 or (2) Ho: r = A, Ha: r > A, a = 0.005
a. If A = 0.95 which test do you think the FDA should use? Explain.
b. If A = 0.05 which test do you think the FDA should use? Explain.
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