Hypothesis Testing: Rejection Region and Significance Level

Rejection Region for p-Statistic at 80% Significance Level

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Question

A statistician has framed his hypothesis testing problem as:

Ho: mean = 100 H1: mean < 100

Specify the region for the p-statistic which will lead to the rejection of the null at the 80% significance level.

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Explanations

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Explanation

Since the alternative is directional and to the left, we use a left-tailed test. For this, the critical value at 80% level is -0.84. -0.84 is the value above which 80% of the probability mass of the standard normal distribution lies). The rejection region is then given by z-statistic &lt; -0.84.