Question

5. I wish to show that the average apartment rent in Statesboro is not $800. I take a SRS of 49
apartments and find the average rent is $750 with a sample standard deviation of $280. Alpha =
.05.
Ho: M = 800
Ha: M ≠ 800

A. Test Statistic =____________
B. Critical Value =____________
C. p-value = _____________________
D. Decision is ________________________

Answer 1

H0: = 800

Ha: 800

a)

Test statistics

z = - / S / sqrt(n)

= 750 - 800 / 280 / sqrt(49)

= -1.50

b)

Critical value at 0.05 level with 48 df = -2.011 , 2.011

c)

From T table,

With test statistics -1.25 and df of 48 ,

p-value = 0.2174

d)

Since p-value > 0.05 level, we fail to reject H0