Question

An industrial plant wants to determine which of two types of fuel, electric or gas, is more cost efficient (measured in cost per unit of energy). Independent random samples were taken of plants using electricity and plants using gas. These samples consisted of

13

plants using electricity, which had a mean cost per unit of

$47.6

and standard deviation of

$8.66

, and

8

plants using gas, which had a mean of

$50.6

and standard deviation of

$8.36

. Assume that the populations of costs per unit are normally distributed for each type of fuel, and assume that the variances of these populations are equal. Can we conclude, at the

0.01

level of significance, that the mean cost per unit for plants using electricity,

μ1

, is less than the mean cost per unit for plants using gas,

μ2

?

Perform a one-tailed test. Then fill in the table below.

Carry your intermediate computations to at least three decimal places and round your answers as specified in the table. (If necessary, consult a list of formulas.)

The null hypothesis:	H0:
The alternative hypothesis:	H1:
The type of test statistic:	(Choose one)ZtChi squareF (degree of freedom if anything other than z)
The value of the test statistic: (Round to at least three decimal places.)
The critical value at the 0.01 level of significance: (Round to at least three decimal places.)
Can we conclude that the mean cost per unit for plants using electricity is less than the mean cost per unit for plants using gas?		Yes	No

Answer 1