A sample of 81 account balances of a credit company showed an average balance of $1200 with a standard deviation of $126
a. Formulate the hypotheses that can be used to determine whether the mean of all account balances is significantly different from $1150.
b. Compute the test statistic.
c. Using the p-value approach, what is your conclusion? Let ? = .05.
a. H0: ? = $1150
Ha: ? ? $1150
b. t = 3.571
c. p-value (almost zero) <.005; therefore, reject H0 and conclude that the mean balance is significantly different from $1150.
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