Question

The mean cost of a basic rental car per week is said to be greater than $125 per week. To determine if this is true, a random sample of 25 rental cars is taken and resulted in an average of $130.50 and an sample standard deviation of $15.40.

Test the appropriate hypotheses at  = 0.05 (1 point each).

H0: _________________

H1: _________________

Test statistic : _________________

p-value : _________________

Is the mean cost greater than $125/week ? (circle one) YES NO

Answer 1

Solution :

= 125

=130.50

s =15.40

n = 25

This is the right tailed test .

The null and alternative hypothesis is ,

H0 :    =

Ha : > 1

Test statistic = t

= ( - ) / s / n

= (130.50 -125 ) /15.40 / 25

= 1.786

Test statistic = t = 1.786

P-value =0.0434

= 0.05  

P-value <

0.0434 < 0.05

Reject the null hypothesis .

Therefore, there is enough evidence to claim that the population mean μ is greater than 125 No