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Revenue for a full-service funeral. According to the
Chapter 7, Problem 42E(choose chapter or problem)
Revenue for a full-service funeral. According to the National Funeral Directors Association (NFDA), the nation’s 22,000 funeral homes collected an average of $6,500 per full-service funeral in 2009 (www.nfda.org). A random sample of 36 funeral homes reported revenue data for the current year. Among other measures, each reported its average fee for a full-service funeral. These data (in thousands of dollars) are shown in the following table.
a. What are the appropriate null and alternative hypotheses to test whether the average full-service fee of U. S. funeral homes this year exceeds $6,500?
b. Conduct the test at \(\alpha=.05\). Do the sample data provide sufficient evidence to conclude that the average fee this year is higher than in 2009?
c. In conducting the test, was it necessary to assume that the population of average full-service fees was normally distributed? Justify your answer.
Questions & Answers
QUESTION:
Revenue for a full-service funeral. According to the National Funeral Directors Association (NFDA), the nation’s 22,000 funeral homes collected an average of $6,500 per full-service funeral in 2009 (www.nfda.org). A random sample of 36 funeral homes reported revenue data for the current year. Among other measures, each reported its average fee for a full-service funeral. These data (in thousands of dollars) are shown in the following table.
a. What are the appropriate null and alternative hypotheses to test whether the average full-service fee of U. S. funeral homes this year exceeds $6,500?
b. Conduct the test at \(\alpha=.05\). Do the sample data provide sufficient evidence to conclude that the average fee this year is higher than in 2009?
c. In conducting the test, was it necessary to assume that the population of average full-service fees was normally distributed? Justify your answer.
ANSWER:Solution
Step 1 of 3
a) We have to test the claim that the average full service fee exceeds 6,500$
Let is the average full service fee
Null hypothesis H0: the average full service fee is 6,500$
Then
Alternative hypothesis H1: the average full service fee exceeds 6,500$
Then (Right tailed test)