# W-1-6 JOMO KENYATTA UNIVERSITY OF AGRICULTURE AND...

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W1-2-60-1-6 JOMO KENYATTA UNIVERSITY OF AGRICULTURE AND TECHNOLOGY University Examinations 2013/2014 YEAR III EXAMINATION FOR THE DEGREE OF BACHELOR OF SCIENCE IN ACTUARIAL SCIENCE STA 2301: TEST OF HYPOTHESIS DATE: APRIL, 2014 TIME: 2 HOURS INSTRUCTIONS: Answer Question ONE and Any Other TWO Questions. Question one (30 Marks) a) Differentiate the following terms: i. Simple hypothesis and composite hypothesis ii. Power of a test and size of a test iii. Critical region and acceptance region b) State and explain two types of errors likely to be committed when a statistical hypothesis is tested on the basis of the sample. [2 marks] c) Let P denote the probability of success in an experiment to be performed thrice. To test the hypothesis H o :P=0.3 against H:P=0.2, the null hypothesis is rejected if the number of successes in the three trials is less than 2. i. Compute the probability of two types of errors likely to be committed. ii. Compute the power of the test iii. What measures should be taken to reduce the two types of errors simultaneously.

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