Question

AT&T claims that its average monthly long distance bill is $17.09. You pick a random sample...

AT&T claims that its average monthly long distance bill is $17.09. You pick a random sample of 100 customers and find the average bill is $17.55. Assume σ = 3.87, and test the claim at the 5% significance level. Is the average monthly long distance bill different from $17.09?

P-value=

(Round to three decimal places)

Math   Statistics-And-Probability   
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Homework Answers

Answer #1

Solution:

The null and alternative hypothesis are

H0 : = 17.09 vs Ha : 17.09

The test statistic z is

z = = [17.55 - 17.09]/[3.87/100] = -1.44

z = 1.19

Now , observe that sign in Ha

So , it is TWO TAILED TEST

For two tailed test ,

p value = P(Z < -z) + P(Z > +z)

= P(Z < -1.19) + P(Z > +1.19)

= 2 * P(Z < -1.19)

= 2 * 0.117 ..use z table

= 0.234

P-value = 0.234

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