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Question

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

c. At α=0.05\alpha=0.05, what is the conclusion to the test? Is the realtor's claim supported by the data?

Solution

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Answered 1 year ago
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Considering this task we know that hypotheses look like this:

H0:μ500,000HA:μ>500,000\begin{aligned} H_0&:\mu\le500,000\\ H_A&:\mu>500,000 \end{aligned}

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

We need to calculate at α=0.05α = 0.05, what is the conclusion to the test.

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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