TABLE 11-7
Data on the percentage of 200 hotels in each of the three large cities across the world on whether minibar charges are correctly posted at checkout are given below.

At the 0.05 level of significance, you want to know if there is evidence of a difference in the proportion of hotels that correctly post minibar charges among the three cities.
-When using the χ² test for independence, you should be aware that expected frequencies that are too small will lead to a large Type I error.

Question

TABLE 11-7
Data on the percentage of 200 hotels in each of the three large cities across the world on whether minibar charges are correctly posted at checkout are given below.
  
At the 0.05 level of significance, you want to know if there is evidence of a difference in the proportion of hotels that correctly post minibar charges among the three cities.
-When using the χ² test for independence, you should be aware that expected frequencies that are too small will lead to a large Type I error.

Quizplus · Accepted Answer

This is true. When using the χ² test for independence, expected frequencies that are too small can lead to the assumption of independence being rejected when it is actually true, resulting in a Type I error. It is important to use caution and possibly combine categories or use exact tests if expected frequencies are too small.

TABLE 11-7 Data on the Percentage of 200 Hotels in Each of Each