Question

UCF is a major Metropolitan University located in Orlando Florida. UCF is advertising their bachelor in Economics with the statistic that the starting salary of a graduate with a bachelor in economics is $ 48,500 according to Payscale.com (2013-13).
The Director of Institutional Research at UCF is interested in testing this information. She decides to conduct a survey of 50 randomly selected recent graduate economic students.
The sample mean is $43,350 and the sample standard deviation is 15,000. Alpha = 0.05

Using the given Null Hypothesis and level of significance

a. The null hypotheisis should be rejected

b. Not enough information is given to answer this question.

c.I have no idea

d. The null hypotheisis should not be rejected Previous Next

Answer 1

Ans. a. The null hypothesis should be rejected

Reason : Since , standard deviation is known, z-distribution is used.

It is a two tailed test.

For a two tailed test:

Rejection Region:

z-value < - zalpha/2  or z-value > zalpha/2

Z-value =

Given : mean = $43350 , standard deviation = $15000 , n = 50 , X bar = $48500

Z-value =

=

= 5150/ 2121.32

Z-value = 2.4277

Now , alpha = 0.05

Zalpha/2 = Z0.05/2 = Z0.025

Using Appendix Table A.3

Z0.025 = 1.96

Since , 2.4277 > 1.96

Z-value > Zalpha/2

Thus , it lies in Rejection Region.

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