Question

A random sample of 89 tourist in the Chattanooga showed that they spent an average of $2,860 (in a week) with a standard deviation of $126; and a sample of 64 tourists in Orlando showed that they spent an average of $2,935 (in a week) with a standard deviation of $138. We are interested in determining if there is any significant difference between the average expenditures of those who visited the two cities? a) Determine the degrees of freedom for this test. b) Compute the test statistic c) Compute the p-value(please show working of calculation) d) What is your conclusion?

Answer 1

Solution:

a) df= n1+n2-2= 89+64-2= 151

b)test statistic is:

c) p-value= 2*p(|t| < -3.49) = 2*0.0003= 0.0006

d) Conclusion:

P-value=0.0006 < 0.05, hence we reject Ho.

There is significant difference between two cities.