Question

Warren County Telephone Company claims in its annual report that “the typical customer spends $63 per month on local and long-distance service.” A sample of 12 subscribers revealed the following amounts spent last month.

$65

$67

$64

$68

$60

$64

$69

$65

$65

$57

$53

$66

a.	What is the point estimate of the population mean? (Round your answer to 3 decimal places.)

Estimated population mean

$

b.	Develop a 95% confidence interval for the population mean. (Use t Distribution Table.) (Round your answers to 3 decimal places.)

Confidence interval for the population mean

$  and $

c.

Is the company's claim that the "typical customer" spends $63 per month reasonable?

	Yes
	No

Answer 1

a) Point estimate of the population mean is $63.583

Explanation:

($65+

$67+

$64+

$68+

$60+

$64+

$69+

$65+

$65+

$57+

$53+

$66)/12=63.583.

b)

here n=12

Confidence interval for the population mean

$ 60.610 to $ 66.557

t	df	Sig. (2-tailed)	Mean Difference	95% Confidence Interval of the Difference
				Lower	Upper
47.065	11	0.000	63.58333	60.610	66.557

c) Is the company's claim that the "typical customer" spends $63 per month reasonable?

No, because the p value is <0.05 so reject the null hypothesis for t test.