For the following exercises where applicable:a. State the

Chapter 8, Problem 16CQ

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QUESTION:

For the following exercises where applicable:

a. State the hypotheses and identify the claim.

b. Find the critical value(s).

c. Compute the test value.

d. Make the decision.

e. Summarize the results.

Use the traditional method of hypothesis testing unless otherwise specified. Assume all variables are normally distributed.

Home Closing Costs A real estate agent believes that the average closing cost of purchasing a new home is $6500 over the purchase price. She selects 40 new home sales at random and finds that the average closing costs are $6600. The standard deviation of the population is $120. Test her belief at \(\alpha=0.05\).

Questions & Answers

QUESTION:

For the following exercises where applicable:

a. State the hypotheses and identify the claim.

b. Find the critical value(s).

c. Compute the test value.

d. Make the decision.

e. Summarize the results.

Use the traditional method of hypothesis testing unless otherwise specified. Assume all variables are normally distributed.

Home Closing Costs A real estate agent believes that the average closing cost of purchasing a new home is $6500 over the purchase price. She selects 40 new home sales at random and finds that the average closing costs are $6600. The standard deviation of the population is $120. Test her belief at \(\alpha=0.05\).

ANSWER:

Solution

Step 1 of 2

We have to test the real estate agent belief is true or not

Here the belief is that the average closing cost of purchasing a new house is $6500 over the purchase price

Here a random sample of 36 women then

                                   The sample mean

                                                       Given

                                                          And

Null hypothesis

Alternative hypothesis (Two tailed test)

The critical value is


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