Dioscussion:
Q: There are three loan officers at Farmer National Bank. All decisions on mortgage loans are made by one of these officers. The president of the bank would like to be sure that the rejection rate is about the same for the three officers. A sample of 200 recent applications yielded the following results. Is the rejection rate related to the officer that processes the loan? Use the 0.05 significance level.
Loan Officer
Felix Otis Foxburrow
Approved 50 70 55
Rejected 10 10 5
Total 60 80 60
1. State the null and alternate hypothesis
2. State the decision rule
3. Compute the value of the test statistic.
4. What is the decision. Interpret the results.