From past records a manufacturer of ceramic plant pots knows that 20\% of them will have defects. To monitor the production process, a random sample of 25 pots is checked each day and the number of pots with defects is recorded.
- Find the critical regions for a two-tailed test of the hypothesis that the probability that a plant pot has defects is 0.20. The probability of rejection in either tail should be as close as possible to 2.5\%. [5]
- Write down the significance level of the above test. [1]
A garden centre sells these plant pots at a rate of 10 per week. In an attempt to increase sales, the price was reduced over a six-week period. During this period a total of 74 pots was sold.
- Using a 5\% level of significance, test whether or not there is evidence that the rate of sales per week has increased during this six-week period. [7]