more income than the national average?
Continuous Probability Distributions
Probability distributions are of two types, which are continuous probability distributions and discrete probability distributions. A continuous probability distribution contains an infinite number of values. For example, if time is infinite: you could count from 0 to a trillion seconds, billion seconds, so on indefinitely. A discrete probability distribution consists of only a countable set of possible values.
Normal Distribution
Suppose we had to design a bathroom weighing scale, how would we decide what should be the range of the weighing machine? Would we take the highest recorded human weight in history and use that as the upper limit for our weighing scale? This may not be a great idea as the sensitivity of the scale would get reduced if the range is too large. At the same time, if we keep the upper limit too low, it may not be usable for a large percentage of the population!
The mean income per person in the United States is $44,500, and the distribution of incomes follows a
a. State the null hypothesis and the alternate hypothesis.
b. State the decision rule for 0.050 significance level.
c. Compute the value of the test statistic.
d. Is there enough evidence to substantiate that residents of Wilmington, Delaware, have more income than the national average at the 0.050 significance level?
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