Hypothesis Testing Research and Evaluation II RES 342

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Hypothesis TestingLaura is the Human Resources manager of a major company, MasterCard. MasterCard is opening up three new facilities and would like Laura to consider relocating to Arizona, California or Illinois. Laura got a team together to help figure out which location would be more efficient. The team has to do research on pay and cost of living expenses. Since transportation is a necessity in today's fast paced environment and a valuable factor to consider when relocating we decided this would be our first step is the hypothesis testing. "Hypothesis testing starts with a statement, or assumption, about a population parameter - such as the population mean. It is a procedure based on sample evidence and probability theory to determine whether the hypothesis is a reasonable statement" (Lind, Marchal, & Wathen, 2004, p 318).

First, the team had to research the gas prices at several gas stations within all three states.

That took 10 random samples from each state and took the average. The team determined that the population mean will be $ 2.99. The team is going to see if there is a difference between the mean of $2.99 and the gas prices in Arizona. Next, the team will take the Arizona gas stations and pick 25 samples, at random, to determine the t value. Then the will take all the samples to determine the proper z value. The team will use the five step process below to determine the proper values. After completing the tests, the team will interpret the results, draw a conclusion and identify differences between the tests. (Lind et al., 2004, p 318)The first step in our test is stating the null. The null will be different for the t and the z test. For the "t" test it will be determined by using the...