AnswersProbability and Statistics with Applications Honors Sem-2-FL-1210300 2024-2025Testing a Claim about a Population MeanQuestion 10
10
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Testing a Claim about a Population Mean
Question 10 • Probability and Statistics with Applications Honors Sem-2-FL-1210300 (2024-2025)
The mean price of houses in the US is $383,500. A real estate agent believes the mean price of houses in a local neighborhood is less than the national mean. The agent takes a random sample of 30 houses and finds the mean price to be $295,089 with a standard deviation of $156,321. The real estate agent conducts a significance test with the alpha level for the mean price of houses in the neighborhood being less than $383,500. The P-value for this significance test is 0.002. What is the correct interpretation of the P-value?
Answer
A
Assuming the true mean price of houses is $383,500, there is a 0.2% probability that the null hypothesis is true by chance alone.B
Assuming the true mean price of houses is $383,500, there is a 0.2% probability of getting a sample mean of $295,089 by chance alone.C
Assuming the true mean price of houses is $383,500, there is a 0.2% probability of getting a sample mean at least as extreme as $295,089 by chance alone.D
Assuming the true mean price of houses is $383,500, there is a 99.8% probability that a sample mean of $295,089 or greater will occur by chance alone.