Hypothesis Test for a Mean (one-tail)

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In 2013, the business department reported that the average monthly salary for co-op students is $2,960. Kenya randomly sampled 25 co-op students in the business department. The sample mean is $3,325 with a standard deviation of $940. Assume the population is normally distributed. At the significance level 𝜶 = 𝟎.𝟎𝟓, is there evidence that the monthly salary is higher now?

(a) Is this a z-test or a t-test?


(b) State the hypotheses:

(c) What is the critical value?



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(d) Find the test statistic:

(e) Find the p-value.



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(f) Select the correct conclusion:

i. We reject 𝐻o; there is evidence that the monthly salary is higher now.
ii. We reject 𝐻o; there is no evidence that the monthly salary is higher now.
iii. We fail to reject 𝐻o; there is evidence that the monthly salary is higher now.
iv. We fail to reject 𝐻o; there is no evidence that the monthly salary is higher now.













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(g) What would be the conclusion if 𝜶 = 𝟎. 𝟎𝟏?

i. We reject 𝐻o; there is no evidence that the monthly salary is higher now.
ii. We fail to reject 𝐻o; there is evidence that the monthly salary is higher now.
iii. We fail to reject 𝐻a; there is no evidence that the monthly salary is the same.
iv. We fail to reject 𝐻o; there is no evidence that the monthly salary is higher now.












(h) What does that say about the strength of the evidence?



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