A spinner has two outcomes, “win” and “lose.” Julia tests \(H_0: p = 0.25\) against \(H_a: p > 0.25\), where \(p\) is the probability of a win. Marc uses a higher benchmark \(p_M\) and tests \(H_0: p = p_M\) against \(H_a: p < p_M\). Both use \(n = 200\) independent spins and \(\alpha = 0.05\).
a) Determine Julia’s rejection region.
b) Let \(p_M = 0.40\). Determine Marc’s rejection region and the win counts for which both tests reject their respective null hypotheses.
c) Explain how the overlap changes as Marc lowers \(p_M\). Using a normal approximation with continuity correction, estimate the value of \(p_M\) below which the two rejection regions no longer overlap.
Hints
- Determine each rejection region from its own null distribution.
- As a binomial parameter decreases, the distribution and its lower-tail cutoff shift left.
- The overlap disappears when Marc’s largest rejection count drops below Julia’s smallest rejection count.
- Use a continuity correction when replacing the binomial probability with a normal probability.
Solution
1. For Julia’s test, under \(H_0\), \(X \sim \operatorname{Bin}(200, 0.25)\). Since \(P(X \le 59) \approx 0.9375\) and \(P(X \le 60) \approx 0.9546\), the right-tailed rejection region is \(R_J = \{61, 62, \ldots, 200\}\).
2. For Marc’s test with \(p_M = 0.40\), \(X \sim \operatorname{Bin}(200, 0.40)\) under \(H_0\). Since \(P(X \le 68) \approx 0.0475\) and \(P(X \le 69) \approx 0.0639\), the left-tailed rejection region is \(R_M = \{0, 1, \ldots, 68\}\). The overlap is \(R_J \cap R_M = \{61, 62, \ldots, 68\}\).
3. As \(p_M\) decreases, Marc’s null distribution shifts left, so the upper endpoint of his rejection region also moves left. The overlap shrinks and disappears once \(61\) is no longer in Marc’s rejection region.
4. At the approximate boundary, use \(P(X \le 61) \approx 0.05\). With continuity correction, \(\Phi\left(\frac{61.5 - 200p_M}{\sqrt{200p_M(1-p_M)}}\right) = 0.05\). Using \(z_{0.05} \approx -1.645\) gives \(p_M \approx 0.363\). Thus, for values below about \(0.363\), the two rejection regions no longer overlap.
Answer
a) \(R_J = \{61, 62, \ldots, 200\}\).
b) \(R_M = \{0, 1, \ldots, 68\}\). Both tests reject for \(X \in \{61, 62, \ldots, 68\}\).
c) Lowering \(p_M\) shifts Marc’s rejection region left and reduces the overlap. The overlap disappears at approximately \(p_M = 0.363\), so values below about \(36.3\%\) produce no common rejection count.