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One Sample Hypothesis Testing on Average Weekly Tips

At the time she was hired as a server at the Grumney Family Restaurant, Beth Brigden was told, "You can average $72 a day in tips." Assume the population of daily tips is normally distributed with a standard deviation of $2.45. Over the first 34 days she was employed at the restaurant, the mean daily amount of her tips was $73.07. At the .10 significance level, can Ms. Brigden conclude that her daily tips average more than $72?

(a) State the null hypothesis and the alternate hypothesis.

(b) State the decision rule.

(c) Compute the value of the test statistic. (Round your answer to 2 decimal places.)

(d) What is your decision regarding H0?

(e) What is the p-value? (Round your answer to 4 decimal places.)

Solution Preview

(a) H0: mu= 72 ; H1: mu > 72
Reason: we are testing daily tips average more than ...

Solution Summary

This solution provides the null and alternative hypothesis. It also calculates the value of test statistic to compare to the p-value to make a decision on either accepting or rejecting the null hypothesis.