A recent publication states that the average closing cost for purchasing a new home is $8586....

A recent publication states that the average closing cost for purchasing a new home is $8586. A real estate agent believes the average closing cost is more than $8586. She selects 28 new home purchases and finds that the average closing costs are $8582 with a standard deviation of $341. Help her decide if she is correct by testing her claim at αα=0.01.

The correct hypotheses would be:

H0:μ≤$8586H0:μ≤$8586
HA:μ>$8586HA:μ>$8586 (claim)
H0:μ≥$8586H0:μ≥$8586
HA:μ<$8586HA:μ<$8586 (claim)
H0:μ=$8586H0:μ=$8586
HA:μ≠$8586HA:μ≠$8586 (claim)

Since the level of significance is 0.01 the critical value is 2.473

The test statistic is: (round to 3 places)

The p-value is: (round to 3 places)

The decision can be made to:

reject H0H0
do not reject H0H0

The final conclusion is that:

There is enough evidence to reject the claim that the average closing cost is more than $8586.
There is not enough evidence to reject the claim that the average closing cost is more than $8586.
There is enough evidence to support the claim that the average closing cost is more than $8586.
There is not enough evidence to support the claim that the average closing cost is more than $8586.

A new baker is trying to decide if he has an appropriate price set for his 3 tier wedding cakes which he sells for $84.68. He is particullarly interested in seeing if his wedding cakes sell for less than the average price. He searches online and finds 23 of the competitors in his area that sell 3 tier wedding cakes with a mean price of $87.73 with a standard deviation of $6.19. Help the new baker by testing his his claim with a 0.10 level of significance.

The correct hypotheses would be:

H0:μ≤$84.68H0:μ≤$84.68
HA:μ>$84.68HA:μ>$84.68 (claim)
H0:μ≥$84.68H0:μ≥$84.68
HA:μ<$84.68HA:μ<$84.68 (claim)
H0:μ=$84.68H0:μ=$84.68
HA:μ≠$84.68HA:μ≠$84.68 (claim)

Since the level of significance is 0.10 the critical value is 1.321

The test statistic is: (round to 3 places)

The p-value is: (round to 3 places)

The decision can be made to:

reject H0H0
do not reject H0H0

The final conclusion is that:

There is enough evidence to reject the claim that his wedding cakes sell for less than the average price.
There is not enough evidence to reject the claim that his wedding cakes sell for less than the average price.
There is enough evidence to support the claim that his wedding cakes sell for less than the average price.
There is not enough evidence to support the claim that his wedding cakes sell for less than the average price.

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Expert Solution

orchestra answered 1 year ago

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