Question

Can it be typed so I can have a better understanding of the question. Thank you!

2. A sample of 64 account balances from a credit company showed an average daily balance of $1,050. The standard deviation of the population is known to be $240. We are interested in determining if the mean of all account balances (i.e., population mean) is significantly different from $1,000.

Answer 1

Solution :

This is the two tailed test .

The null and alternative hypothesis is ,

H₀ :   = 1000

H_a :    1000

Test statistic = z

= ( - ) / / n

= (1050 - 1000) / 240 / 64

= 1.67

P(z > 1.67) = 1 - P(z < 1.67) = 0.0475

P-value = 2 * 0.0475 = 0.0950

= 0.05

P-value >

Fail to reject the null hypothesis .

There is not sufficient evidence that the mean of all account balances (i.e., population mean) is significantly

different from $1,000.