Question 126127
Faced with rising fax costs, a firm issues a guideline that transmissions of 10 pages or more should be sent by 2-day mail instead. Exceptions are allowed, but they want the average to be 10 or below. The firm examined 35 randomly chosen fax transmissions during the next year, yielding a sample mean of 14.44 with a standard deviation of 4.45 pages. (a) At the .01 level of significance, is the true mean greater than 10?
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Ho: mu <= 10
Ha: mu > 10
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alpha = 1%
Critical value: t=2.326
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Test statistic: 
t(14.44) = (14.44-10)/[4.45/sqrt(35)] = 5.90
p-value = 5.758..*10^(-7) or almost zero.
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Conclusion: Reject Ho because p-value is much, much less than 1%
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The test gives strong statistical evidence that the mean is 
greater than 10.
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Cheers,
Stan H.