The researcher wants to determine whether there is a relation between the type of residence owned and the level of the family income. He randomly sampled 100 homeowners and obtained the following data:
Single Family Home
up to 30K
more than 100K
Solution This solution is FREE courtesy of BrainMass!
We will use chi square test. Chi-square Test of Independence tests the association between two categorical variables. Here the categorical variables are Income level and the type of residence.
Chi square test is really just a comparison between expected frequencies and observed frequencies among the cells in a cross tabulation table. The researcher has created a cross tabulation table which can be used for calculating the chi squared value and testing the relationship.