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With double- digit annual percentage increases in the cost of health insurance, more and more workers are likely to lack health insurance coverage. The following sample data provide a comparison of workers with and without health insurance coverage for small, medium, and large companies. For the purposes of this study, small companies are companies that have fewer than 100 employees. Medium companies have 100 to 999 employees, and large companies have 1000 or more employees. Sample data is reported as follows:
Health Insurance
Size of Company
Yes
No
Total
Small
50
25
75
Medium
80
20
100
Large
115
10
125
245
55
300
Conduct a test of independence using critical-value approach to determine whether employee health insurance coverage is independent of the size of the company. State the Hypotheses and the conclusion. Use α = .005.
What is the p-value? What is your conclusion based on p-value approach?
The USA Today article indicated employees of small companies are more likely to lack health insurance coverage. Use percentages based on the preceding data to support this conclusion.
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