Question

Can someone explain why the Ho should be 12 and not 144. I got 12, but one of my peers got 144.

10. Consumer Reports uses a 100-point customer satisfaction score to rate the nation's major chain stores. Assume that from past experience with the satisfaction rating score, a population standard deviation of σ-12 is expected. In 2012, Costco with its 432 warehouses in 40 states was the only chain store to earn an outstanding rating for overall quality. A sample of 15 Costco customer satisfaction scores follows. Costco 95 98 86 75 82 64. 95 93 62 83 83 94 90 80 80 a. What is the sample mean customer satisfaction score for Costco? b. What is the sample variance? c. What is the sample standard deviation? d. Construct a hypothesis test to determine whether the population standard deviation of σ-12 should be rejected for Costco. With a .05 level of significance, what is your conclusion?

Answer 1

In our problem we have to test population standard deviation

$\sigma$ is equal to 12 or not .

This is test for population standard deviation $\sigma$ , not for testing of population variance $\sigma$². That why we take H0 : $\sigma$ = 12 and

H1 : $\sigma$  $\notequal$not equal to 12