Question

20. During a recent year, the average cost of making a movie was 54.8 million dollars. This year, a random sample of 15 recent action movies had an average production cost of 62.3 million dollars with a variance of 90.25 million dollars. At the 0.05 level of significance (alpha), can it be concluded that it costs more than average to produce an action movie?

NOTE: be sure to take the square root of a given Variance in the word problems to obtain the standard deviation and use that for your figuring

a. Yes

b. No

Answer 1

Solution:

Answer : YES

Explanation:

H0: = 54.8

H1: >  54.8

Now ,

n = 15   ....sample size

= 62.3 ...sample mean

s² = 90.25....Sample variance

So , s = 9.5

= 0.05 .... level of significance

The test statistics t is given by ..

t =  

= (62.3 - 54.8)/(9.5/15)

t = 3.058

Now, >  sign in H1 indicates that the Right tailed test.

df = n - 1 = 15 - 1 = 14

So , p value = 0.0085

p value is less than = 0.05

Reject H₀

YES , it can it be concluded that it costs more than average to produce an action movie.

Answer : YES