The mayor of a large city claims that the average net worth of families living in this city is at most $300,000. A random sample of 25 families selected from this city produced a mean net worth $288,000. Assume that the net worth of all families in this city have a normal distribution with the population standard deviation of $80,000. What is the parameter of interest?

Question

Sage Hartman

Mathematics

17 April, 16:46

The mayor of a large city claims that the average net worth of families living in this city is at most $300,000. A random sample of 25 families selected from this city produced a mean net worth $288,000. Assume that the net worth of all families in this city have a normal distribution with the population standard deviation of $80,000. What is the parameter of interest?

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Answers (1)

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Semaj Pope · Answer 1

Check the explanation

Step-by-step explanation:

Below are the null and alternative Hypothesis,

Null Hypothesis, H0: μ = 300000

Alternative Hypothesis, Ha: μ < 300000

Test statistic,

z = (xbar - mu) / (sigma/sqrt (n))

z = (288000 - 300000) / (80000/sqrt (25))

z = - 0.75

P-value Approach

P-value = 0.2266

As P-value > = 0.05, fail to reject null hypothesis.