A recent study by Allstate Insurance Co. finds that 82% of teenagers have used cell phones while driving ( The Wall Street Journal , May 5, 2010). In October 2010, Massachusetts enacted a law that forbids cell phone use by drivers under the age of 18. A policy analyst would like to determine whether the law has decreased the proportion of drivers under the age of 18 who use a cell phone.
a. State the null and the alternative hypotheses to test the policy analyst’s objective.
b. Suppose a sample of 200 drivers under the age of 18 results in 150 who still use a cell phone while driving. What is the value of the test statistic? What is the p-value?
c. At α = 0.05 has the law been effective?
d. Repeat this exercise using the critical value approach with α = 0.05.