Question

(12) The average tuition and room and board cost at a small private liberal arts college is reported to be $20,000 per term. A study of 400 small liberal arts colleges find that the average cost per term is $20,100. The population standard deviation is $1,500. If α = 0.05, what is the p- value for the test: Ho: µ= 20,000?

Answer 1

Solution :

This is the two tailed test .

The null and alternative hypothesis is ,

H₀ :   = 20000

H_a :    20000

Test statistic = z

= ( - ) / / n

= (20100 - 20000) / 1500 / 400

Test statistic = 1.33

P(z > 1.33) = 1 - P(z < 1.33) = 0.0918

P-value = 0.1834