In: Statistics and Probability
An article found that Massachusetts residents spent an average of $860.70 on the lottery in 2010, more than three times the U.S. average (www.businessweek.com, March 14, 2012). A researcher at a Boston think tank believes that Massachusetts residents spend less than this amount. He surveys 100 Massachusetts residents and asks them about their annual expenditures on the lottery.
Expenditures |
790 |
594 |
899 |
1105 |
1090 |
1197 |
413 |
803 |
1069 |
633 |
712 |
512 |
481 |
654 |
695 |
426 |
736 |
769 |
877 |
777 |
785 |
776 |
1119 |
833 |
813 |
747 |
1244 |
1023 |
1325 |
719 |
1182 |
528 |
958 |
1030 |
1234 |
833 |
745 |
985 |
774 |
1002 |
561 |
681 |
546 |
777 |
844 |
856 |
785 |
1289 |
502 |
703 |
334 |
1140 |
594 |
719 |
1002 |
943 |
1025 |
969 |
576 |
627 |
989 |
915 |
662 |
802 |
876 |
962 |
878 |
668 |
1227 |
947 |
864 |
1016 |
1022 |
723 |
665 |
1072 |
610 |
538 |
992 |
978 |
1291 |
1139 |
1111 |
873 |
850 |
941 |
845 |
639 |
495 |
1016 |
939 |
974 |
893 |
645 |
1098 |
788 |
682 |
686 |
764 |
759 |
a. Specify the competing hypotheses to test the researcher’s claim.
H0: μ = 860.70; HA: μ ≠ 860.70
H0: μ ≥ 860.70; HA: μ < 860.70
H0: μ ≤ 860.70; HA: μ > 860.70
b-1. Calculate the value of the test statistic. (Negative value should be indicated by a minus sign. Round intermediate calculations to at least 4 decimal places and final answer to 3 decimal places.)
b-2. Find the p-value.
p-value < 0.01
0.01 ≤ p-value < 0.025
0.025 ≤ p-value < 0.05
0.05 ≤ p-value < 0.10
p-value ≥ 0.10
c. At α = 0.10, what is the conclusion?
Reject H0; there is insufficient evidence to state that the average Massachusetts resident spent less than $860.70 on the lottery in 2010
Reject H0; there is sufficient evidence to state that the average Massachusetts resident spent less than $860.70 on the lottery in 2010
Do not reject H0; there is sufficient evidence to state that the average Massachusetts resident spent less than $860.70 on the lottery in 2010
Do not reject H0; there is insufficient evidence to state that the average Massachusetts resident spent less than $860.70 on the lottery in 2010