SOLUTION: The average household income for a recent year in Fiji was $30,000. Five years earlier the average household income was $24,500. Assume sample sizes of 34 were used and the populat

Question 1181976: The average household income for a recent year in Fiji was $30,000. Five years earlier the average household income was $24,500. Assume sample sizes of 34 were used and the population standard deviations of both samples were $5928. At 5% level of significance is there enough evidence to believe that the average household income has increased?
Answer by Boreal(15235) (Show Source): You can put this solution on YOUR website!
This is a z-test, and assuming normality and random samples, the critical value will be z>1.645 with a one-way test.
z=(30000-24500)/5928/sqrt(34)
=5500*sqrt(34)/5928
=5.41
strongly reject the null hypothesis and conclude the average household income has increased.
p-value << 0.0001 (about 6 x 10^(-8))

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