Question

A consumer advocate group claims the average American household spends more than $874 during Christmas. The claim is tested with a sample of 64 households and finds the average of the sample to be $905 with a standard deviation of $125. Level of significance is 0.05. Answer the following:

a) write Ho and Ha and identify which is the claim

b) identify whether its left, right or two tailed

c) write the p-value

d) decide whether to reject or fail to reject the null hypothesis

e) interpret the final decision in the context of the original claim.

Answer 1