Question

A recent publication states that the average closing cost for purchasing a new home is $8500....

A recent publication states that the average closing cost for purchasing a new home is $8500. A real estate agent believes that the average closing cost is more than $8500. She selects 31 new home purchases and finds that the average closing costs are $8029. The population standard deviation of $361. Help her decide if she is correct by testing her claim at αα=0.10.

The correct hypotheses would be:

  • H0:μ≤$8500H0:μ≤$8500
    HA:μ>$8500HA:μ>$8500 (claim)
  • H0:μ≥$8500H0:μ≥$8500
    HA:μ<$8500HA:μ<$8500 (claim)
  • H0:μ=$8500H0:μ=$8500
    HA:μ≠$8500HA:μ≠$8500 (claim)



Since the level of significance is 0.10 the critical value is 1.282

The test statistic is: (round to 3 places)

The p-value is: (round to 3 places)

The decision can be made to:

  • reject H0H0
  • do not reject H0H0



The final conclusion is that:

  • There is enough evidence to reject the claim that the average closing cost is more than $8500.
  • There is not enough evidence to reject the claim that the average closing cost is more than $8500.
  • There is enough evidence to support the claim that the average closing cost is more than $8500.
  • There is not enough evidence to support the claim that the average closing cost is more than $8500.

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