Consolidated Power, a large electric power utility, has just built a modern nuclear power plant. This plant
Question:
A sample of 100 temperature readings will be obtained each day, and if the sample results cast a substantial amount of doubt on the hypothesis that the cooling system is working properly (the mean temperature of waste water discharged is 60°F or cooler), then the plant must be shut down and appropriate actions must be taken to correct the problem.
a. Consolidated Power wishes to set up a hypothesis test so that the power plant will be shut down when the null hypothesis is rejected. Set up the null and alternative hypotheses that should be used.
b. In the context of this situation, interpret making a Type I error; interpret making a Type II error.
c. The EPA periodically conducts spot checks to determine whether the waste water being discharged is too warm. Suppose the EPA has the power to impose very severe penalties (for example, very heavy fines) when the waste water is excessively warm. Other things being equal, should Consolidated Power set the probability of a Type I error equal to α = .01 or α = .05? Explain.
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Related Book For
Business Statistics In Practice
ISBN: 9780073401836
6th Edition
Authors: Bruce Bowerman, Richard O'Connell
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