Question

Recently the national average yield on municipal bonds has been ? = 4.19%. A random sample of 16 Arizona municipal bonds had an average yield of 5.11% with a sample standard deviation of s = 1.15%. Does this indicate that the population mean yield for all Arizona municipal bonds is greater than the national average? Use a 5% level of significance. Assume x is normally distributed. a. State the null and alternate hypotheses and the level of significance. Is the test left-tailed, right-tailed, or two-tailed?

b. Identify the appropriate sampling distribution: the standard normal or the Student’s t. What is the value of the sample test statistic?

c. Find or estimate the P-value.

d. Based on your answers for parts (a) through (c), will you reject or fail to reject the null hypothesis?

Answer 1

X?= 5.11

n= 16

s= 1.15

df= 16-1-15

H0: u= 4.19

H1: u> 4.19 ......right tail test

alpha= 0.05

Test Statictics

T=(X?-u)*sqrt(n)/s

=(5.11-4.19)*sqrt(16)/1.15

=3.2

P-value=0.002981924

rounded p-value=0.003

Decision making

P-value ? Alpha Reject H0

0.003 <0.05

there is enough evidence to support the claim that population mean yield for all Arizona municipal bonds is greater than the national average.

.............

a) H0: u=4.19

H1: u> 4.19 ......right tail test

b) t- test statistics =3.2

c) p-value-0.00298

d) Reject null hypothesis.

.........................

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