Question

Home values tend to increase over time under normal conditions, but the recession of 2008 and...

Home values tend to increase over time under normal conditions, but the recession of 2008 and 2009 has reportedly caused the sales price of existing homes to fall nationwide.† You would like to see if the data support this conclusion. The file HomePrices contains data on 30 existing home sales in 2006 and 40 existing home sales in 2009.

2006 ($)
213,100 226,200 239,100
214,300 161,700 181,200
228,600 222,100 228,900
235,800 219,400 238,800
301,800 264,200 320,200
315,000 118,900 172,400
137,500 212,800 175,400
311,400 296,900 292,500
287,700 246,500 195,600
155,300 152,400 211,200
2009 ($)
155,400 189,800 200,800 280,400
213,200 181,100 117,400 130,000
170,000 149,600 146,200 54,400
213,800 186,000 182,100 180,000
215,700 164,200 95,300 239,500
207,200 188,200 169,400 185,600
177,000 178,000 161,200 249,200
146,400 99,800 246,700 173,500
138,100 112,200 137,500 147,900
179,000 116,200 197,500 164,200

(a)

Provide a point estimate of the difference (in dollars) between the population mean prices for the two years. (Use year 2006 − year 2009. Round your answer to the nearest dollar.)

$

(b)

Develop a 99% confidence interval estimate of the difference (in dollars) between the resale prices of houses in 2006 and 2009. (Use year 2006 − year 2009. Round your answers to the nearest dollar.)

$  to $

(c)

Would you feel justified in concluding that resale prices of existing homes have declined from 2006 to 2009? Why or why not?

To answer this question, we need to conduct a hypothesis test.

State the null and alternative hypotheses. (Let μ1 = mean home price in 2006 and let μ2 = mean home price in 2009.)

H0:

μ1 − μ2 ≤ 0

Ha:

μ1 − μ2 > 0

H0:

μ1 − μ2 = 0

Ha:

μ1 − μ2 ≠ 0

    

H0:

μ1 − μ2 ≠ 0

Ha:

μ1 − μ2 = 0

H0:

μ1 − μ2 > 0

Ha:

μ1 − μ2 ≤ 0

H0:

μ1 − μ2 ≤ 0

Ha:

μ1 − μ2 = 0

Find the value of the test statistic. (Round your answer to three decimal places.)

Find the p-value. (Round your answer to four decimal places.)

p-value =

State your conclusion. (Use α = 0.01)

Do not reject H0. We can not conclude that existing home prices have declined between 2006 and 2009.Do not reject H0. We can conclude that existing home prices have declined between 2006 and 2009.     Reject H0. We can not conclude that existing home prices have declined between 2006 and 2009.Reject H0. We can conclude that existing home prices have declined between 2006 and 2009.

Homework Answers

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Home values tend to increase over time under normal conditions, but the recession of 2008 and...
Home values tend to increase over time under normal conditions, but the recession of 2008 and 2009 has reportedly caused the sales price of existing homes to fall nationwide.† You would like to see if the data support this conclusion. The file HomePrices contains data on 30 existing home sales in 2006 and 40 existing home sales in 2009. 2006 ($) 213,100 226,200 239,100 214,300 161,700 181,200 228,600 222,100 228,900 235,800 219,400 238,800 301,800 264,200 320,200 315,000 118,900 172,400 137,500...
Commercial real estate prices and rental rates suffered substantial declines in 2008 and 2009.† These declines...
Commercial real estate prices and rental rates suffered substantial declines in 2008 and 2009.† These declines were particularly severe in Asia; annual lease rates in Tokyo, Hong Kong, and Singapore declined by 40% or more. Even with such large declines, annual lease rates in Asia were still higher than those in many cities in Europe. Annual lease rates for a sample of 30 commercial properties in an Asian city showed a mean of $1,118 per square meter with a standard...
Commercial real estate prices and rental rates suffered substantial declines in 2008 and 2009.† These declines...
Commercial real estate prices and rental rates suffered substantial declines in 2008 and 2009.† These declines were particularly severe in Asia; annual lease rates in Tokyo, Hong Kong, and Singapore declined by 40% or more. Even with such large declines, annual lease rates in Asia were still higher than those in many cities in Europe. Annual lease rates for a sample of 30 commercial properties in an Asian city showed a mean of $1,116 per square meter with a standard...
You may need to use the appropriate technology to answer this question. Commercial real estate prices...
You may need to use the appropriate technology to answer this question. Commercial real estate prices and rental rates suffered substantial declines in 2008 and 2009.† These declines were particularly severe in Asia; annual lease rates in Tokyo, Hong Kong, and Singapore declined by 40% or more. Even with such large declines, annual lease rates in Asia were still higher than those in many cities in Europe. Annual lease rates for a sample of 30 commercial properties in an Asian...
The National Association of Home Builders provided data on the cost of the most popular home...
The National Association of Home Builders provided data on the cost of the most popular home remodeling projects. Sample data on cost in thousands of dollars for two types of remodeling projects are as follows. Kitchen Master Bedroom 25.2 18.0 17.4 22.9 22.8 26.4 21.9 24.8 19.7 26.9 23.0 17.8 19.7 24.6 16.9 21.0 21.8 23.6 Develop a point estimate of the difference between the population mean remodeling costs for the two types of projects. Develop a 90% confidence interval...
Nine homes are chosen at random from real estate listings in two suburban neighborhoods, and the...
Nine homes are chosen at random from real estate listings in two suburban neighborhoods, and the square footage of each home is noted in the following table. Size of Homes in Two Subdivisions   Subdivision Square Footage   Greenwood 2,312 2,471 2,490 2,892 2,341 2,412 2,830 2,723 2,350   Pinewood 2,600 2,494 2,558 2,816 2,391 2,574 2,558 2,854 3,466 (a) Choose the appropriate hypothesis to test if there is a difference between the average sizes of homes in the two neighborhoods at the...
An article in American Demographics investigated consumer habits at the mall. We tend to spend the...
An article in American Demographics investigated consumer habits at the mall. We tend to spend the most money shopping on the weekends, and, in particular, on Sundays from 4 to 6 p.m. Wednesday morning shoppers spend the least! Suppose that a random sample of 21 weekend shoppers and a random sample of 21 weekday shoppers were selected, and the amount spent per trip to the mall was recorded. Weekends Weekdays Sample Size 21 21 Sample Mean ($) 75 62 Sample...
The National Sleep Foundation surveyed representative samples of adults in six different countries to ask questions...
The National Sleep Foundation surveyed representative samples of adults in six different countries to ask questions about sleeping habits.† Each person in a representative sample of 250 adults in each of these countries was asked how much sleep they get on a typical work night. For the United States, the sample mean was 391 minutes, and for Mexico the sample mean was 426 minutes. Suppose that the sample standard deviations were 27 minutes for the U.S. sample and 42 minutes...
Consider the following data drawn independently from normally distributed populations: x1 = 34.4 x2 = 26.4...
Consider the following data drawn independently from normally distributed populations: x1 = 34.4 x2 = 26.4 σ12 = 89.5 σ22 = 95.8 n1 = 21 n2 = 23 a. Construct the 90% confidence interval for the difference between the population means. (Negative values should be indicated by a minus sign. Round all intermediate calculations to at least 4 decimal places and final answers to 2 decimal places.) Confidence interval is__________ to__________. b. Specify the competing hypotheses in order to determine...
Are nursing salaries in City A lower than those in City B? As reported by a...
Are nursing salaries in City A lower than those in City B? As reported by a newspaper, salary data show staff nurses in City A earn less than staff nurses in City B. Suppose that in a follow-up study of 40 staff nurses in City A and 50 staff nurses in City B you obtain the following results. City A City B n1 = 40 n2 = 50 x1 = $56,200 x2 = $59,400 s1 = $6,000 s2 = $7,000...