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A hypothesis test to determine is a restaurant site is acceptable based on pedestrian traffic.

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A fast food franchiser is considering building a restaurant at a certain location. Based on financial analyses, a site is acceptable only if the number of pedestrian passing the location averages more than 100 per hour. The number
of pedestrians observed for each of 40 hours was recorded and stored in the attached excel file .
Assuming that the population standard deviation is known to be 12, can we conclude that the site is acceptable? (set your own significance level)

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Solution Summary

The following outlines the process of conducting a hypothesis test to determine if pedestrian traffic averages more than 100 per hour. statistics are computed in Excel and a detailed explanation is provided in a Word document. A z-test is used.

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Solution. Denote the number of pedestrian passing the location per hour by X and assume that X follows normal distribution with mean and the standard deviation . By the definition that a site is acceptable only if the number of pedestrian passing the location averages more than 100 per hour, i.e., . So we can set up the following null ...

Solution provided by:
Changping Wang, MA
Education
  • BSc , Wuhan Univ. China
  • MA, Shandong Univ.
Recent Feedback
  • "Your solution, looks excellent. I recognize things from previous chapters. I have seen the standard deviation formula you used to get 5.154. I do understand the Central Limit Theorem needs the sample size (n) to be greater than 30, we have 100. I do understand the sample mean(s) of the population will follow a normal distribution, and that CLT states the sample mean of population is the population (mean), we have 143.74. But when and WHY do we use the standard deviation formula where you got 5.154. WHEN & Why use standard deviation of the sample mean. I don't understand, why don't we simply use the "100" I understand that standard deviation is the square root of variance. I do understand that the variance is the square of the differences of each sample data value minus the mean. But somehow, why not use 100, why use standard deviation of sample mean? Please help explain."
  • "excellent work"
  • "Thank you so much for all of your help!!! I will be posting another assignment. Please let me know (once posted), if the credits I'm offering is enough or you ! Thanks again!"
  • "Thank you"
  • "Thank you very much for your valuable time and assistance!"
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