After a financial analysis, the general manager of a large company decided that if more than 10% of potential buyers of a new product purchase that product, the company would show a profit. In a preliminary survey of 500 potential buyers, 62 people say that they will buy the product.

a. Develop appropriate hypotheses to test whether the product will produce a profit.

b. Is there sufficient evidence at the 5% significance level that the product will produce a profit? Apply both the p -value approach and the critical value method.

c. Use the sample to construct a 95% confidence interval estimate for the proportion of potential buyers who would purchase the product.

d. Refer to the confidence interval estimate obtained in (c). Can we conclude with 95% confidence that the product will produce a profit? Briefly explain your answer.

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a b Sample proportion is Test statistic is pvalue approach since pvalue is less th... View the full answer