Question

A distributor of personal computers has five locations in a city. In the year's first quarter, the sales in units were: Location Observed Sales (units) North side 70 Pleasant Township 75 Southwick 70 I-90 50 Venice Avenue 35 Total 300 For a goodness-of-fit test that sales were the same for all locations, what is the critical value at the 0.01 level of risk

Answer 1

It is observed that the value of test statistics (19.168) is greater than the critical value (13.277), thus the rejected hypothesis, H₀ at α = 0.01.

There is enough evidence to conclude or deduce that sales were the same for all locations

Step-by-step explanation:

Solution

Given that:

Object: Test whether the sales were the same for all locations by applying 1% significance level.

The Null Hypothesis H₀ : Sales were the same for all locations

E₁ = 70 +75 +70+ 50 + 35/5 = 60

The Alternative Hypothesis Hₐ : Sales were not the same for all locations

Now,

The decision rule:

the Level of Significance be α = 0.01

Degrees of freedom is df= Number of categories -1

=5-1 = 4

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