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Exercise 10-44 (LO10-6) A United Nations report shows the mean family income for Mexican migrants to the United States is $27d. Does this information disagree with the United Nations report? Apply the 0.01 significance level. HO. This data the report

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Answer #1

a)

H0: \mu = 27300

Ha: \mu \neq 27300

b)

Criitcal value at 0.01 significance level with 19 df = \pm 2.861

Decision rule = Reject H0 if t < -2.861 OR t > 2.861

c)

Test statistics

t = (\bar{x} - \mu ) / ( S / sqrt(n) )

= ( 28500 - 27300) / (9651 / sqrt(20) )

= 0.56

d)

Since test statistics falls in non-rejection region, fail to reject H0.

Fail to reject H0. This data agree with the United Nations report.

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