American Express Interview Question | Fair Coin
Question
You are provided a simple coin. But the problem is that we are not sure whether it is biased or not? What should be your approach to check the fairness of the coin?
(Hint- Hypothesis Theorem)
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Answer ( 1 )
We use Hypothesis testing to solve this problem:
HO: coin is fair, p = 0.5 (population proportion of heads is the same as tails)
H1: there are three ways to disagree with Ho. We can say:
1. coin is biased toward heads, p > 0.5 (more heads than tails were observed), or
2.coin is biased toward tails p<0.5(less heads than tails), or
3. coin is biased p≠0.5 (the numbers of heads and tails are
not nearly equal)
Suppose we tossed coin 100 times then 30 times head and 70 times tail. then we calculate then it is calculate p then then based on that we can conclude. Also define ALPHA prior