A PC manufacturer claims that no more than 5% of their machines are defective. In a random sample of 100 machines, it is found that 8.5% are defective. The manufacturer claims this is a fluke of the sample. At a .02 level of significance, test the manufacture’s claim, and explain your answer..

MegaStat Output
Hypothesis test for proportion vs. hypothesized value

Observed    Hypothesized
.085               .05             p (as decimal)
9/100            5/100         p (as fraction)
8.5                  5.0             x
100                 100            n

  0.0218 std. error

  1.61 Z

    .0541 p-value (one-tailed, upper)


Our null hypothesis is

H0: p=5%


H1: p<5%

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