Exercise You are the head of the Food and Drug Administration (F.D.A.), in charg

Question

Exercise You are the head of the Food and Drug Administration (F.D.A.), in charge of deciding whether new drugs are effective and should be allowed to be sold to people. A pharmaceu- tical company trying to win approval for a new drug they manufacture claims that their drug is better than the standard drug at curing a certain disease. The company bases this claim on a study in which they gave their drug to 1000 volunteers with the disease. They compared these volunteers to a group of 1000 hospital patients who were treated with the standard drug and whose information is obtained from existing hospital records. The com pany found a 'statistically significant" difference between the percentage of volunteers who were cured and the percentage of the comparison group who were cured. That is, they did a statistical hypothesis test and rejected the null hypothesis that the percentages are equal. As director of the F.D.A., should you permit the new drug to be sold? Explairn your reasoning in three or less sentences

Explanation / Answer

No, there is not enough evidence here.

Becuase here hypothesis carried out is two directional. For this research, a one tail test should have been carried out. The present results just show that there is a difference in % of people cured. It doesn't tell us if the % of people cured from new drug is greater than standard drug or not.

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