When working for the Brooklyn district attorney, investigator Robert Burton analyzed the leading digits of the amounts from 784 checks issued by seven suspect companies. The frequencies were found to be 0, 15, 0, 76, 479, 183, 8, 23, and 0, and those digits correspond to the leading digits of 1, 2, 3, 4, 5, 6, 7, 8, and 9, respectively. If the observed frequencies are substantially different from the frequencies expected with Benford’s law, the check amounts appear to result from fraud. Use a 0.01 significance level to test for goodness-of-fit with Benford’s law. Does it appear that the checks are the result of fraud?
Answer to relevant QuestionsExercise 21 lists the observed frequencies of leading digits from amounts on checks from seven suspect companies. Here are the observed frequencies of the leading digits from the amounts on checks written by the author: 68, ...The table in Exercise 1 is called a contingency table or two-way table. Why is the term contingency used? Why is the terminology of two-way table used? Alert nurses at the Veteran’s Affairs Medical Center in Northampton, Massachusetts, noticed an unusually high number of deaths at times when another nurse, Kristen Gilbert, was working. Those same nurses later noticed ...In his book Outliers, author Malcolm Gladwell argues that more American-born baseball players have birthdates in the months immediately following July 31 because that was the cutoff date for nonschool baseball leagues. The ...Use the data in the table below with a 0.05 significance level to test the claim that when flipping or spinning a penny, the outcome is independent of whether the penny was flipped or spun. Does the conclusion change if the ...
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