Advanced Business Statistics: Speed Trap Sign Test Proposal and Hypothesis

A state police officer is considering setting up a speed trap at a certain stretch of I95 South to Richmond. The reason for the speed trap is that officer believes that most cars are being driven to exceed the speed limit in this area. Using the sign test, design a speed trap experiment that the police officer could use to test her belief. Use notional numbers to demonstrate how the test would operate. Use a sample size of 20 cars, and use the Excel BINOM. DIST function as written in the book to generate the appropriate p-value.

  1. Describe the test you are proposing. 3 pts.

Based on that design and a set of 20 notional (dummy) numbers for demonstration purposes only, answer the following.

  1. State the null hypothesis. 1 pt.
  1. State the alternative hypothesis. 1 pt
  1. State the significance level. 1 pt.
  1. Perform the calculations; include the notional data. 3 pts.