How do you select the correct test statistic, Microeconomics

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How do you select the correct test statistic

Discussion:

Discuss the "Classical Hypothesis Test: A Five-Step Procedure" on page 173 of your textbook.

1. Write the 5 step procedure

2. Explain the importance of checking for normality in the assumptions in step 2.

3. Why is step 3 so difficult for most statistics students?

4. How do you select the correct test statistic?

5. Can you ever "prove" the alternative hypothesis?

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