A lending institution supplied the following data on loan approvals by four loan officers. Conduct an appropriate Hypothesis test to determine whether the loan approval decision is independent of the loan officer reviewing the loan application.
|
|
Loan ApprovalDecision
|
|
|
LoanOfficer
|
Rejected
|
Approved
|
Total
|
|
Sean
|
14
|
12
|
26
|
|
Bruce
|
14
|
18
|
32
|
|
Debbie
|
16
|
34
|
50
|
|
Susie
|
16
|
26
|
42
|
|
Total
|
60
|
90
|
150
|
a) State the Null and Alternate Hypotheses.
b) Determine the value of the test statistic.
c) Determine p-value. Conduct Hypothesis test using p-value approach with α = .025. What is the test decision?
d) Determine Critical-Value. Conduct Hypothesis test using Critical-Value approach with α = .05. What is the test decision?
e) Do the results in parts c) and d) lead to different conclusions? Why or Why not?
f) Based on test decisions under parts c) and d), what conclusion would youdraw?