Question

You want to investigate the potential for a new organic bread product, and will conduct a research study involving the preferences of consumers. Suppose that, in the judgment of management, the product should not be introduced unless at least the average household would spend at least $6.00 per month on this bread, and that the research calls for 21 respondents to be interviewed for their preferences.

Family	Spend
1	6.04
2	4.22
3	5.21
4	7.76
5	8.24
6	6.32
7	7.66
8	10.12
9	5.54
10	7.88
11	8.76
12	3.21
13	7.89
14	9.84
15	6.89
16	9.32
17	6.55
18	2.65
19	7.09
20	7.87
21	6.91

a. State the null and alternate hypotheses.

b. The attached database shows the amount spent on bread for each of the 21 households. What is the average amount spent per household? What is the standard error?

c. Can you reject your null hypothesis? (For a t-test, using 0.05 significance level and a sample size of 21, the correct tabled t-value is 2.086). State clearly, in plain English, your conclusion regarding the null hypothesis. Include an Excel printout or screen shot to show how you arrived at your conclusion.

Answer 1

One sample t-test:

Hypothesis:

b) n=21

Sample mean:

Sample standard deviation:

Standard error:

c) The test statistic:

The degree of freedom = n-1= 20

T-critical: 2.086

The test statistic is not significant and failed to rejects H0. There is sufficient evidence to support the claim that the average household spend at least $6.00 per month on this bread