Where do CFOs get their money news? According to Robert Half International, 47%

Question

Where do CFOs get their money news? According to Robert Half International, 47% get their money news from newspapers, 15% get it from communication/ colleagues, 12% get it from television, 11% from the Internet, 9% from magazines, 5% from radio, and 1% don’t know. Suppose a researcher wants to test these results. She randomly samples 67 CFOs and finds that 40 of them get their money news from newspapers. Does the test show enough evidence to reject the findings of Robert Half International? Use = .05.

(Round your answer to 2 decimal places.)

reject the null hypothesis/fail to reject the null hypothesis?

Explanation / Answer

The null hypothesis formulated is that there is NO significant difference between the findings of Robert Half International and observed proportion of CFOs getting their money news from newspapers.

Ho : p = 47% or 0.47

q = 1-p = 1- 0.47 = 0.53

n = 67

Standard error of p = S.E(p)

= sqrt (pq/n)

= sqrt (0.47*0.53/67)

= sqrt 0.003718

= 0.061

Observed p = 40/67 = 0.60

Expected p = 47% = 0.47

Difference = (O-E)/S.E = 0.60-0.47 / 0.061 = 0.13 / 0.061 = 2.13

The value of test statistic or z score at a = 0.05 is 1.96

Since the calculated value (2.13) is greater than the critical value (1.96), at a=0.05, the null hypothesis will be rejected.

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