For the following claim answer each

Question

. A tourist agency in Florida claims the mean daily cost of meals and lodging for a family of four traveling in Florida is $252. You want to test this claim and in a random sample of 50 families of four traveling to Florida, the mean daily cost of meals and lodging is $260 with a standard deviation of $25. Use a 5% level of significance to test the agency’s claim.

(a) State the Null and Alternative

(b) Is it Left-, Right-, or Two-Tailed?

(c) Find the standardized test statistic.

(d) What is the decision?

(e) Interpret the results

Answer 1

(a) State the Null and Alternative

Ho: mean = 252

Ha: mean /= 252

(b) Is it Left-, Right-, or Two-Tailed?

Two-tailed

(c) Find the standardized test statistic.

z = (260-250)/(25/sqrt(50)) = 2.82

(d) What is the decision?

p-value = 2 * P(z < -2.82) = 0.0048

reject H0 that mean is 252

(e) Interpret the results

There is sufficient evidence that the population mean differs from 252 at the 0.05 level of significance.