Question

Harry thinks that prices in caldwell are higher than the rest of the country. he reads that the nationwide average price of a certain brand of laundry detergent is $24.15 with standard deviation $2.48. he takes a sample from 4 local caldwell stores and finds the average price for this same brand of detergent is $25.79.

H₀ :

Ha :

Answer 1

The hypothesis test concludes that the pricing has a larger standard deviation than claimed by the manufacturer.

Step-by-step explanation:

The hypothesis test in this question involves comparing the sample standard deviation to a claimed standard deviation, and we want to determine if the pricing has a larger standard deviation than claimed by the manufacturer.

We can set up a hypothesis test by using a significance level of 5%. The null hypothesis, H₀, is that the standard deviation is equal to the claimed standard deviation. The alternative hypothesis, Ha, is that the standard deviation is larger than the claimed standard deviation. To conduct the test, we calculate the sample standard deviation of the prices from the website, which is $38.62.

Comparing this sample standard deviation to the claimed standard deviation of $25, we find that the sample standard deviation is larger. Therefore, we can argue that pricing has a larger standard deviation than claimed by the manufacturer.

As a potential buyer, the practical conclusion from this analysis is that there is a significant variability in the prices of the computer, which may influence the decision to purchase based on budget and preferences.