Question

A certain company will purchase the house of any employee who is transferred out of state and will handle all details of reselling the house. The purchase price is based on two assessments, one assessor being chosen by the employee and one by the company Based on the sample of eight assessments shown, do the two assessors agree? Use the 10 level of significance Assessments of Eight Homes ($ thousands) Assessed by Home 1 Home 2 Home 3 Company Employee Home 4 279 283 Home 5 293 305 Home 6 287 285 Home 7 535 550 Home 8 745 770 348 342 454 480 321 318 (a) Choose the appropriate hypotheses. Assume d company assessed value-employee assessed value HO- d-0 versus HT- d # 0. O Ho.ud # 0 versus Hn.ud-o (b) State the decision rule for 10 level of significance. (Round your answers to 2 decimal places. A negative value should be indicated by a minus sign.) Reject the null hypothesis if tcalcor tcalc (c-1) Find the test statistic tcalc. (Round your answer to 2 decimal places. A negative value should be indicated by a minus sign.) calc (c-2) What is your conclusion? wel (Click to select-I the null hypothesis.

Answer 1

null Hypothesis alternate Hypothesis 0 0 for 0.1 level with two tailed test and n-1- 7 degree of freedom, critical value of t- Decision rule 1.8946 reject Ho if absolute value of test statistic |t|>1.895 Employee 318 342 difference(d) x1-x2 S. No Company 321 9.000000 36.000000 676.000000 16.000000 144.000000 4.000000 225.000000 625.000000 Σd2-1735 2 26 279 293 287 535 745 283 12 2 15 25 550 total mean dbar- 8.875 degree of freedom -n-1 Std deviaiton SpV(zd-(Ed)/n)/(n-1) - std error-Se So/Vn - test statistic 7.000 12.5634 4.4418 1.998

a)

null Hypothesis:		μd	=	0
alternate Hypothesis:		μd	≠	0

b)

reject if tcalc <-1.89 or tcalc>1.89

c-1) tcalc =-2.00

c-2) we can reject the null hypothesis