APPLIED STAT.IN BUS.+ECONOMICS
APPLIED STAT.IN BUS.+ECONOMICS
6th Edition
ISBN: 9781259957598
Author: DOANE
Publisher: RENT MCG
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Chapter 9, Problem 81CE

a.

To determine

State the hypotheses.

a.

Expert Solution
Check Mark

Answer to Problem 81CE

Null hypothesis:

H0:μ90

Alternative hypothesis:

H1:μ<90

Explanation of Solution

The given information is that, the data represents the scores for Friday quizzes.

Bob’s claim that he is really a 90+ performer.

The test hypotheses are given below:

Null hypothesis:

H0:μ90

Alternative hypothesis:

H1:μ<90

b.

To determine

State the formula for the test statistic and also describe the decision rule at 1% level of significance.

b.

Expert Solution
Check Mark

Answer to Problem 81CE

The formula for test statistic is,

tcalc=x¯μ0sn

Decision rule is, reject H0 if tcalc<2.998.

Explanation of Solution

Test statistic:

The formula for test statistic is,

tcalc=x¯μ0sn

Where x¯ is the sample mean, μ0 is the population mean, s is the sample standard deviation and n is the sample size.

Degrees of freedom:

df=n1=81=7

Critical value:

Software procedure:

Step-by-step software procedure to obtain critical value using EXCEL is as follows:

  • Open an EXCEL file.
  • In cell A1, enter the formula “=T.INV(0.01,7)”
  • Output using Excel software is given below:

APPLIED STAT.IN BUS.+ECONOMICS, Chapter 9, Problem 81CE , additional homework tip  1

From the output, the critical value of Student’s t is t0.01=2.998.

Decision rule for left-tailed test at α=0.01:

If tcalc<2.998, then reject the null hypothesis.

c.

To determine

Find the test statistic and state the conclusion.

c.

Expert Solution
Check Mark

Answer to Problem 81CE

There is evidence to infer the Bob’s claim that he is really a 90+ performer.

Explanation of Solution

Calculation:

  • Sample mean and variance:
  • The formula for mean is,
  • x¯=xin
  • The formula for standard deviation is,
  • s=(xix¯)2n1
  • The value of (xix¯)2 and mean is calculated as follows:
Score(xix¯)(xix¯)2
80–8.37570.14063
85–3.37511.39063
956.62543.89063
923.62513.14063
890.6250.390625
84–4.37519.14063
901.6252.640625
923.62513.14063
xi=707

(xix¯)2=173.875

x¯=88.375
  • The standard deviation is,
  • s=173.87581=24.8393=4.984
  • Thus, the standard deviation is 4.984.

Substitute x¯=88.375, μ0=90, s=4.984 and n=8 in the test statistic formula.

tcalc=88.375904.9848=1.625(4.9842.8284)=1.6251.7621=0.92

Thus, the test statistic is –0.92.

Conclusion for critical value method:

Here, the test statistic is greater than the critical value.

That is, tcalc(=0.92)>2.998

Therefore, the null hypothesis is not rejected.

Hence, there is evidence to infer the Bob’s claim that he is really a 90+ performer.

d.

To determine

Describe the assumptions for given hypotheses tests.

d.

Expert Solution
Check Mark

Explanation of Solution

The assumption is necessary to validate the given test is the population is normally distributed.

e.

To determine

Find the p-value by using Excel and interpret it.

e.

Expert Solution
Check Mark

Answer to Problem 81CE

The p-value is 0.1941.

There is evidence to infer the Bob’s claim that he is really a 90+ performer.

Explanation of Solution

Calculation:

Degrees of freedom:

df=n1=81=7

p-value:

Software procedure:

Step-by-step software procedure to obtain p-value using EXCEL is as follows:

  • Open an EXCEL file.
  • In cell A1, enter the formula “=T.DIST(–0.92,7)”.
  • Output using Excel software is given below:

APPLIED STAT.IN BUS.+ECONOMICS, Chapter 9, Problem 81CE , additional homework tip  2

Thus, the p-value is 0.1941.

Decision rule:

If p-value<α, then reject the null hypothesis.

Conclusion for p-value method:

Here, the p-value is greater than the level of significance.

That is, p-value(=0.1941)>α(=0.01).

Therefore, the null hypothesis is not rejected.

Hence, there is evidence to infer the Bob’s claim that he is really a 90+ performer.

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Chapter 9 Solutions

APPLIED STAT.IN BUS.+ECONOMICS

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