SOLUTION: Hypothesis testing A recent article in the Wall Street Journal reported that the 30-year mortgage rate is now less than 6 percent. A sample of eight small banks in the Midwest r

Question 122049This question is from textbook
: Hypothesis testing
A recent article in the Wall Street Journal reported that the 30-year mortgage rate is now less than 6 percent. A sample of eight small banks in the Midwest revealed the following 30- year rates (in percent):
4.8 5.3 6.5 4.8 6.1 5.8 6.2 5.6

At the .01 significance level, can we conclude that the 30-year mortgage rate for small banks is less than 6 percent? Estimate the p-value.
This question is from textbook

Answer by stanbon(75887) (Show Source): You can put this solution on YOUR website!
A recent article in the Wall Street Journal reported that the 30-year mortgage rate is now less than 6 percent. A sample of eight small banks in the Midwest revealed the following 30- year rates (in percent):
4.8 5.3 6.5 4.8 6.1 5.8 6.2 5.6
At the .01 significance level, can we conclude that the 30-year mortgage rate for small banks is less than 6 percent? Estimate the p-value.
---------------------------------------------
Ho: mu=0.06
Ha: mu<0.06
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for alpha=0.01, the critical value =
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For the data set the sample mean = 5.6375%
Test Statistic:
t(0.056375) = -1.6157..
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The p-value associated with t=-1.6157 is approximately 0.0751
Since the p-value is greater than 1%, fail to reject Ho.
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Conclusion: Fail to reject Ho.
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Cheers,
Stan H.
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