To determine if there is sufficient evidence that the bags are underfilled, we can set up the null and alternative hypotheses as follows:

1. Null Hypothesis (H₀): The machine is filling the bags correctly at the 426-gram setting. $H_0: \mu = 426$ where $\mu$ is the true mean weight of the bags filled by the machine.

2. Alternative Hypothesis (H₁): The machine is underfilling the bags. $H_1: \mu < 426$

In this case, since we are testing if the bags are underfilled (specifically less than 426 grams), we use a one-tailed test with the alternative hypothesis $H_1: \mu < 426$. The significance level ($\alpha$) is 0.02.

Would you like to proceed with the steps for testing this hypothesis or need further assistance on this?

Here are some related questions you might find helpful:

1. How do we determine if the machine’s output is normally distributed?
2. What is the critical value for a one-tailed test at the 0.02 significance level?
3. How is the sample mean used in hypothesis testing in this context?
4. What role does the standard deviation play in testing the mean?
5. What type of error could occur if we incorrectly reject the null hypothesis?

Tip: In hypothesis testing, remember that the null hypothesis is typically a statement of no effect or no difference, which we test against an alternative hypothesis.