## Related questions with answers

A realtor in Mission Viejo, California, believes that the average price of a house is more than $\$ 500,000$.

b. The data accompanying this exercise show house prices. (Data are in $\$ 1,000 \mathrm{~s}$.) Assume the population standard deviation is $\$ 100$ (in $\$ 1,000$ s). What is the value of the test statistic and the $p$-value?

Solution

VerifiedConsidering this task we know that hypotheses look like this:

$\begin{aligned} H_0&:\mu\le500,000\\ H_A&:\mu>500,000 \end{aligned}$

and the sample of $n = 36$ house prices, while the population standard deviation is $\sigma=\$100,000$.

We need to calculate the value of the test statistic and $p-$ value.

*To begin with, we need to find the average share price for a given sample, remember what is mean in this case and how is it found?*

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