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3. In 2009 a congressional subcommittee concluded...

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3. In 2009 a congressional subcommittee concluded that inflated home appraisals are responsible, in part, for many defaulted home mortgages. The subcommittee?s research found that 10% of the home mortgages had inflated home appraisals. A bank that offers Jumbo loans (more than $400,000) to customers with excellent credit scores wants to see if their strict screening process of home mortgage applications resulted in lower percentage of homes mortgages with inflated home appraisals. They took a sample of 300 and out of that 25 had inflated home appraisals. i) Find the 95% Confidence Interval for the proportion of the home mortgages that had inflated home appraisals. ii) State the Null and the Alternative hypothesis conduct the test and state your conclusion in words? (Do using hand calculations.) iii) A bank employee obtains the following Minitab printouts for the above problem; did he do the correct test? Explain in detail the mistakes in both printouts.

 

Paper#13105 | Written in 18-Jul-2015

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