The R.R. Bowker Company of New York collects information on the retail prices of collectible children's books and publishes its findings in Publisher's Weekly. Last year, the mean retail of collectible children's books was $35.44. A random sample of 40 collectible children's books (published this year) is selected, the retail prices are noted, and the results are as follows:
Sample Size: 40
Sample Mean: $38.75
Sample Standard Deviation: $7.35
Does the sample data provide evidence to conclude that the mean retail price of collectible children's books has increased over last year (using a= .10)? Use the hypothesis testing procedure outlined below.
a. Formulate the null and alternative hypotheses.
b. State the level of significance.
c. Find the critical value (or values), and clearly show the rejection and nonrejection regions.
d. Compute the test statistic.
e. Decide whether you can reject Ho and accept Ha or not.
f. Explain and interpret your conclusion in part e, What does this mean?
g. Determine the observed p-value for the hypothesis test and interpret this value. What does this mean?
h. Does this sample data provide evidence (with a=0.10), that the mean retail price of collectable children's books has increased over last year?
The null hypothesis tested is
H0: Mean retail price of collectible children's ...
Null & Alternative Hypotheses: Retail Prices