Recently the national average yield on municipal bonds has been μ = 4.19%. A random sample of 16 Arizona municipal bonds gave an average yield of 5.11% with a sample standard deviation s = 1.15%. Does this indicate that the population mean yield for all Arizona municipal bonds is greater than the national average? Use α = 0.05. Assume x is normally distributed.
a) State the null and the alternate hypothesis.
b) Identify the sampling distribution to be used: the standard normal distribution or the Student's t distribution. Find the critical value(s).
c) Compute the z or t value of the sample test statistic.
d) Find the P value or an interval containing the P value for the sample test statistic.
e) Based on your answers to a through d, decide whether or not to reject the null hypothesis at the given significance level. Explain your conclusion in the context of the problem
The solution consists of a detailed explanation of testing a hypothesis using a 5-step procedure.