Question

The table below presents the summary statistics for the starting annual salaries (in thousands of dollars) for individuals entering the public accounting and financial planning professions.

Sample I (public accounting): X?₁ = 60.35, 3.25 S₁ = 3.25, n₁ = 12 n   

Sample II (financial planning): X?₂ = 58.20, 2.48 S₂ = 2.48, n₂ = 14 n

Test whether the mean starting annual salaries for individuals entering the public accounting professions is higher than that of financial planning assuming that the two population variances are the same.

a) What are the relevant hypotheses tested?

b) What is(are) the critical value(s) of the relevant hypothesis test if the level of significance is 0.05?

c) What is(are) the critical value(s) of the relevant hypothesis test if the level of significance is 0.10?

d) What is the smallest level of significance at which the null hypothesis will still not be rejected?

e) Suppose ? = 0.10. Which of the following represents the result of the relevant hypothesis test?

1) The alternative hypothesis is rejected.

2) The null hypothesis is rejected.

3) The null hypothesis is not rejected.

4) Insufficient information exists on which to make a decision.

f) Suppose ? = 0.01. Which of the following represents the result of the relevant hypothesis test?

1) The alternative hypothesis is rejected.

2) The null hypothesis is rejected.

3) The null hypothesis is not rejected.

4) Insufficient information exists on which to make a decision.

g) Suppose ? = 0.10. Which of the following represents the correct conclusion?

1) There is not enough evidence that the mean starting annual salaries for individuals entering the public accounting professions is not higher than that of financial planning.

2) There is not enough evidence that the mean starting annual salaries for individuals entering the public accounting professions is not higher than that of financial planning.

3) There is not enough evidence that the mean starting annual salaries for individuals entering the public accounting professions is higher than that of financial planning.

4) There is enough evidence that the mean starting annual salaries for individuals entering the public accounting professions is higher than that of financial planning.

h) Suppose ? = 0.01. Which of the following represents the correct conclusion?

1) There is not enough evidence that the mean starting annual salaries for individuals entering the public accounting professions is not higher than that of financial planning.

2) There is not enough evidence that the mean starting annual salaries for individuals entering the public accounting professions is not higher than that of financial planning.

3) There is not enough evidence that the mean starting annual salaries for individuals entering the public accounting professions is higher than that of financial planning.

4) There is enough evidence that the mean starting annual salaries for individuals entering the public accounting professions is higher than that of financial

Answer 1

g) Suppose ? = 0.10. Which of the following represents the correct conclusion?

Answer :- 4) There is enough evidence that the mean starting annual salaries for individuals entering the public accounting professions is higher than that of financial planning.

h) Suppose ? = 0.01. Which of the following represents the correct conclusion?

Answer: - 3) There is not enough evidence that the mean starting annual salaries for individuals entering the public accounting professions is higher than that of financial planning.