Question

A college’s admissions guide state that students spend approximately $300 for textbooks each semester. A random sample of 31 college students finds that the sample mean for the amount spent on textbooks is $365. Assume that the standard deviation for the population is $75. Test at the a = .02 level to determine if students spend significantly more than the amount stated in the admission’s guide.

Answer 1

H0: $\mu$ <= 300

Ha: $\mu$ > 300

Test statistics

Z = $\bar{x }$ - $\mu$ / $\sigma$ / sqrt(n)

= 365 - 300 / 75 / sqrt( 31)

= 4.825

This is test statistics value.

Critical value at 0.02 level is 2.054

Since test statistics > 2.054, we have sufficient evidence to reject H0.

We conclude at 0.02 level that we have enough evidence to support the claim.