A subtle form of racial discrimination in housing is "racial steering." racial steering occurs when real estate agents show prospective buyers only homes in neighborhoods already dominated by that family's race. tenants at a large apartment complex recently filed a lawsuit alleging racial steering. the plaintiffs claimed that whitewhite potential renters were steered to section a, while african-american renters were steered to section

b. the accompanying table displays the data that were presented in court to show the locations of recently rented apartments. do you think there is evidence of racial steering

B. H0 : There is no association between race and the section of the apartment complex.

H A: There is an association between race and the section of the apartment complex.

Find the χ2 statistic

Solution

The formula for calculating χ2 statistic is given by;

χ2∗ = ∑ (Oi-Ei) 2/Ei, where Oi and Ei is the i^th observation and the i^th expected count

From the given data calculated the expected count using the formula; E = (row total * column total) / sample size

χ2 = 7.104439336,

χ2 = 7.104 (rounded to 3 decimal. places)

The P-value is;

Degrees of freedom = (2-1) * (2-1) = 1, χ2 = 7.1044

P-value from chi-square calculator is 0.007689