In: Statistics and Probability
A professor in the
school of business at a certain university wants to investigate the
claim that the prices of new textbooks in the campus store are
higher than a competing national online bookstore. The professor
randomly chooses required texts for 12 business school courses. The
data is given in the table below.
Book Number | Campus Store | Online Store |
Book 1 | 125.45 | 124.27 |
Book 2 | 88.37 | 86.21 |
Book 3 | 230.98 | 229.6 |
Book 4 | 151.8 | 153.02 |
Book 5 | 236.44 | 237.4 |
Book 6 | 86.54 | 87.1 |
Book 7 | 146.09 | 144.21 |
Book 8 | 155.13 | 154.21 |
Book 9 | 164.82 | 161.71 |
Book 10 | 215.04 | 216.31 |
Book 11 | 249.83 | 246.81 |
Book 12 | 221.46 |
220.09 |
(a) Let XAXA denote the price of books at the campus store, and
XBXB be the price of books at the online store, also let
XD=XA−XBXD=XA−XB. Choose the correct statistical hypotheses.
A. H0:μD=0,HA:μD≠0H0:μD=0,HA:μD≠0
B.
H0:μcampus=μonline,HA:μcampus<μonlineH0:μcampus=μonline,HA:μcampus<μonline
C. H0:μD=0,HA:μD<0H0:μD=0,HA:μD<0
D.
H0:μcampus=μonline,HA:μcampus>μonlineH0:μcampus=μonline,HA:μcampus>μonline
E.
H0:μcampus=μonline,HA:μcampus≠μonlineH0:μcampus=μonline,HA:μcampus≠μonline
F. H0:μD=0,HA:μD<0H0:μD=0,HA:μD<0
G.
H0:μD>0,HA:μD<0H0:μD>0,HA:μD<0
H. H0:μD=0HA:μD>0H0:μD=0HA:μD>0
(b) Carry out the appropriate statistical test and find the
P-value, to at least three decimal places.
(c) Based on the above calculations, we should ? reject
not reject the null hypothesis. Use α=0.05
(d) Using the technology available to you,check the assumption(s)
that need to be satisfied for your inferences in (b) and (c) to be
valid. What statement below aligns with your findings?
A. The prices charged at the online bookstore are
normally distributed.
B. The differences in the price of a textbook at
the campus bookstore and the price of the textbook at the online
store are normally distributed.
C. The prices charged at the online bookstore are
not normally distributed.
D. The differences in the price of a textbook at
the campus bookstore and the price of the textbook at the online
store are not normally distributed.
E. The prices charged at the campus bookstore are
normally distributed.
F. The prices charged at the campus bookstore are
not normally distributed.
(a) Option: H. H0:μD=0 HA:μD>0
(b)
t-Test: Paired Two Sample for Means | ||
Campus Store | Online Store | |
Mean | 172.6625 | 171.745 |
Variance | 3260.176148 | 3260.698155 |
Observations | 12 | 12 |
Pearson Correlation | 0.99962014 | |
Hypothesized Mean Difference | 0 | |
df | 11 | |
t Stat | 2.019436984 | |
P(T<=t) one-tail | 0.034241211 | |
t Critical one-tail | 1.795884819 | |
P(T<=t) two-tail | 0.068482422 | |
t Critical two-tail | 2.20098516 |
Test statistic=2.0194
P-value=0.0342
(c) Since P-value<0.05, so reject the null hypothesis.
(d)
From above probability plot we see that the differences follow normal distribution hence
Option: B. The differences in the price of a textbook at the campus bookstore and the price of the textbook at the online store are normally distributed.