Question

An advertisement for a popular supermarket chain claims that it has had consistently lower prices than four other full-service supermarkets. As part of a survey conducted by an "independent market basket price-checking company," the average weekly total, based on the prices (in $) of approximately 95 items, is given for two different supermarket chains recorded during 4 consecutive weeks in a particular month.

Week Advertiser ($) Competitor ($)

1. 254.19 256.00

2 240.66 255.59

3. 231.96 255.20

4 234.04 261.27

(a) Is there a significant difference in the average prices for these two different supermarket chains? (Use α = 0.05. Round your answers to three decimal places.)

test statistic=

t > =

t < =

(b) Construct a 99% confidence interval for the difference in the average prices for the two supermarket chains. (Round your answers to two decimal places.)

Answer 1

a)

from above test statsitic = -2.992

rejection region:

t> NONE

t< -2.353

b)

for 99% CI; and 3 degree of freedom, value of t=			5.841
therefore confidence interval=sample mean -/+ t*std error
margin of errror          =t*std error=		32.802
lower confidence limit                     =		-49.6043
upper confidence limit                    =		15.9993
from above 99% confidence interval for population mean =(-49.60 ,16.00)