Question

	Austin	Houston
Sample Size	15	12
Sample Mean	188.2000	155.3333
Sample Standard Deviation	41.4319	28.4328
df	25
Pooled Sample Standard Deviation	36.2905
Confidence Interval (in terms of Austin - Houston)
Confidence Coefficient	0.90
Lower Limit	8.8583
Upper Limit	56.8750
Hypothesis Test (in terms of Austin - Houston)
Hypothesized Value	5
Test Statistic
p-value (Lower Tail)
p-value (Upper Tail)	0.0292
p-value (Two Tail)

Expedia is interested in looking at the difference in the average price of a hotel room in Austin versus one in Houston. Fifteen hotels in Austin and 12 hotels in Houston were randomly selected and the nightly room rates recorded. Based on Expedia’s results, can they say there is more than a $5 difference in the average price of a hotel room between these two cities at α=.025? State the hypothesis in terms of Austin – Houston. Use the excel output above to answer the following question.

What is the decision?

Answer 1

it is upper tailed hypothesis because we want to test whether the difference is more than $5 or not.

Using the excel data output table, we can get the p value = 0.0292

it is clear that the p value is greater than the significance level of 0.025

therefore, failed to reject the null hypothesis

we can say that there is insufficient evidence to conclude that the difference is more than $5 in the average price of a hotel room between these two cities