Question

Suppose that the US population average household annual income is $60,000. City officials in Sacramento want to determine if the average household annual income in Sacramento is different than the national average. Assume they dont know how to conduct hypothesis testing using p-values but have collected data useful for constructing a 95% confidence interval. They provide the following for Sacramento sample mean of $70,000 and margin of error of $11,000.

Part A: Construct the 95% confidence interval

Part B: Is Sacramento average income different from the national average? In this case a "a= .05" and a 95% confidence interval are related. Use what you know about confidence intervals to answer this question (no p-values are required here) justify your answer.

Answer 1