Question

A sample of 81 account balances of a credit company showed an average balance of $1,200 with a standard deviation of $126. You want to determine if the mean of all account balances is significantly different from last years average balance of $1,150. Use a .05 level of significance.

State the null and alternative hypothesis.

A) H_o: u > 1,150   H_a: u < 1,150

B) H_o: u < 1,150   H_a: u > 1,150

C) Ho: u = 12     Ha: u ¹ 12

D) H_o: u > 1,150   H_a: u > 1,150

Answer 1

Solution :

The null and alternative hypothesis are  

Ho : μ =1150 ; Ha : μ ≠ 1150

explanation :

* a , c, d are incorrect because according to the null hypothesis it does'nt consider the cases of inequality

* here the population parameters are equal to some hypothesised value while stating the null hypothesis

* here u = 1150 it is taken as the null hypothesis  

* by this we understand the option " b " is incorrect because the value 12 has not been stated anywhere

so finally the answer is none of the options are correct

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