Question

The U.S. average for state and local taxes for a family of four is $4172. A random sample of 20 families in a northeastern state indicates that they paid an annual amount of $4560 with a standard deviation of $1590. At α = 0.05, is there sufficient evidence to conclude that they pay more than the national average of $4172?

Answer 1

Calculating p-value from excel

p-value = 0.144458 (From excel =T.DIST.RT(1.091,19))

p-value = 0.144458 > 0.05

So, we failed to reject the null hypothesis. There is sufficient evidence to conclude that they pay not more than the national average of $4172.

Explanation:

Here the given de4tails are,

Hypothesized mean = 4172

Sample Standard deviation = 1590

Sample mean = 4560

Sample size n = 20

Formulation of hypothesis