Question

In: Economics

Consider the following contingency table of observed frequencies. Complete parts a. through d. below. Column Variable...

Consider the following contingency table of observed frequencies. Complete parts a. through d. below.

Column Variable

Row Variable

C1

C2

C3

R1

7

6

9

R2

11

9

8

a. Identify the null and alternative hypotheses for a​ chi-square test of independence with based on the information in the table. This test will have a significance level of

α=0.05.

Choose the correct answer below.

A.

H0​:

The variables

R1​,

R2​,

C1​,

C2​,

and

C3

are independent.

H1​:

At least one of the variables is not independent.

B.

H0​:

The row and column variables are independent of one another.

H1​:

The row and column variables are not independent of one another.Your answer is correct.

C.

H0​:

The row and column variables are not independent of one another.

H1​:

The row and column variables are independent of one another.

D.

H0​:

The variables

R1​,

R2​,

C1​,

C2​,

and

C3

are independent.

H1​:

None of the variables are independent.

​b, Calculate the expected frequencies for each cell in the contingency table.

Column Variable

Row Variable

C1

C2

C3

R1

nothing

nothing

nothing

R2

nothing

nothing

nothing

​(Round to two decimal places as​ needed.)

Solutions

Expert Solution

The contingency table of observed frequencies is given as follows:

C1 C2 C3 Row Total
R1 7 6 9 22
R2 11 9 8 28
Column Total 18 15 17 Grand Total = 50

(a) Chi-square test is a test of independence between two variables. The null and alternative hypothesis for chi-square test is given by:

H0: There is no association between the row and column variables.

H1: The exists an association between the row and column variables.

Thus, for the given test the hypothesis is given by:

H0​: The row and column variables are independent of one another.

H1​: The row and column variables are not independent of one another.

Answer: Option (B)

(b) The expected frequencies are calculated using the following formula:

Expected Frequency = (Row Total * Column Total) / Grand Total

The contingency table of expected frequencies is calculated as follows:

C1 C2 C3 Row Total
R1 22*18/50 = 7.92 22*15/50 = 6.60 22*17/50 = 7.48 22
R2 28*18/50 = 10.08 28*15/50 = 8.40 28*17/50 = 9.52 28
Column Total 18 15 17 Grand Total = 50

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