# Aj Davis Part B Essay

Project Part B: Hypothesis Testing and Confidence Intervals

A. The average (mean) annual income was less than $50,000

• Null Hypothesis is the average annual income is ≥ to $50,000. o Ho: µ ≥ 50,000 • Alternate Hypothesis is the average annual income is < than $50,000. o Ha: µ < 50,000 • Analysis Plan significance level is: a = 0.05 • n > 30 the z test was used to test the hypothesis • Alternative Hypothesis Ha: µ ≥ 50,000, this means the test is a one tailed z test.

Critical Value and Decision Rule • C.V: a = 0.05 the lower tailed z test is 1.645 • D.R: reject Ho if z – statistic is -1.645

Sample Z using Minitab: • Income

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The 95% lower confidence limit is 4441. Since the 4300 is smaller than the 95%lower confidence limit we can support the claim that the average credit balance for suburban customers is more than $4300.

A.

Welcome to Minitab, press F1 for help.

One-Sample Z: I

The assumed standard deviation = 14.55

Variable N Mean StDev SE Mean 95% CI

I 50 43.48 14.55 2.06 (39.45, 47.51)

B.

Test and CI for One Proportion

Sample X N Sample p 95% CI

1 21 50 0.420000 (0.281882, 0.567940)

Test and CI for One Proportion

95% Lower

Sample X N Sample p Bound

1 21 50 0.420000 0.301384

C.

One-Sample Z: Y

Test of mu = 1.645 vs not = 1.645

The assumed standard deviation = 5.103

Variable N Mean StDev SE Mean 95% CI

Y 50 12.380 5.103