The average gasoline price of one of the major oil companieshas been $1.25 per l

Question

The average gasoline price of one of the major oil companieshas been $1.25 per liter. Recently the company has undertakenmeasures in order to reduce prices. Management is interestedin determining whether their measures have acutallyreduced prices. A random sample of 49 oftheir gas stations is selected and the average price is determinedto be $1.20 per liter. The standard deviation of thepopulation is $0.14. a. The standard error has a value of? b. The value of the test statistic for this hypothesistest is? c. The p-value is? The average gasoline price of one of the major oil companieshas been $1.25 per liter. Recently the company has undertakenmeasures in order to reduce prices. Management is interestedin determining whether their measures have acutallyreduced prices. A random sample of 49 oftheir gas stations is selected and the average price is determinedto be $1.20 per liter. The standard deviation of thepopulation is $0.14. a. The standard error has a value of? b. The value of the test statistic for this hypothesistest is? c. The p-value is?

Explanation / Answer

Given n=49, xbar=1.2,s=0.14 (a) s/n = 0.14/sqrt(49) = 0.02 (b) Z=(xbar-)/(s/n) = (1.2-1.25)/0.02= -2.5 (c) p-value= P(Z

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