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19. The average cost of owning and operating an automobile is 8121 dollars per 15,000 miles...

19. The average cost of owning and operating an automobile is 8121 dollars per 15,000 miles including fixed and variable costs. A random survey of 40 automobile owners revealed an average cost of 8350 dollars with a population standard deviation of 750 dollars. Is there sufficent evidence to conclude that the average is greater than 8121 dollars?

NOTE: be sure to take the square root of a given Variance in the word problems to obtain the standard deviation and use that for your figuring

a. There is not enough evidence to support the claim

b. There is sufficient evidence to support the claim

math   Statistics-And-Probability   
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Answer #1

Since , the population standard deviation is known.

Therefore , use Z-test.

Hypothesis: Vs

The test is one-tailed test.

The test statistic is ,

Since , the significance level is not given.

Therefore , assume that significance level=

The critical value is ,

; From Z-table

Decision : Here , the value of the test statistic lies in the rejection region.

Therefore , reject Ho.

Conclusion :Hence , there is enough evidence to support the claim.

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