1. A motel manager, concerned with customer theft of towels, decided that the theft rate might be reduced by changing from white, imprinted towels to a drab green version. Of the 120 guests provided with the white tow- els, 35% took at least one towel with them when they checked out. Of the 160 guests given the drab green tow- els, only 25% checked out with one or more towels in their possession. At the 0.01 level of significance, can we conclude that the manager's idea is effective in reducing the rate of towel theft?

2. An Internal Revenue Service manager is compar- ing the results of recent taxpayer interviews conducted by two auditors. Of 200 taxpayers audited by Ms. Smith, 30% had to pay additional taxes. Of 100 audited by Mr. Burke, only 19% paid additional taxes. At the 0.01 level of significance, can the manager conclude that Ms. Smith is a more effective auditor than Mr. Burke?