An accounting firm is trying to decide between IT training conducted in-house an

Question

An accounting firm is trying to decide between IT training conducted in-house and the use of third-party consultants. To get some preliminary cost data, each type of training was implemented at two of the firm's offices located in different cities. The table below shows the average annual training cost per employee at each location. Are the mean costs significantly different? Assume that the assumptions for inference are satisfied. Complete parts a through c. Click the icon to view the results. a write appropriate hypotheses. Let 1 be be the mean cost of raining in-house and 2 be he mean cost of raining using consultants. Choose the correct answer below. IT Training Costs n Mean SD IT Trainin In-house 210 Consultants 180 b) Below is a summary of computer output for this hypothesis test. Explain what the P-value means in this context. 2-Sample t-Test of -H2 0; t-Statistic -2.38 w/303 df; P:0.018 O A. There is about an 18 in 100 chance that these results are incorect and they should be accepted as true. 0 B. There is about an 18 in 1000 chance that these results are incorrect and they should be accepted as true. Print Done the population means or the two types o training are actually equal there is about an 18 in 1000 chance o seeing a difference a large as or larger than the observed difference ust om natural sampling var D lf the population means or the two types o training are actually unequal there is about an 18 i 1000 chance o seeing a difference as large as or larger than the observed differe ce ust om natural sampling variation. c) State a conclusion about IT costs based on the hypotheses. Use -0.05. O A. On average, IT training costs are significan y different when performed in-house compared to outsourcing to a consultant. B. On average, IT training cosis are significantly more expensive when performed in-house compared to outsourcing to a consultant. OC. On average, IT training costs are significantly less expensive when performed in-house compared to cutsourcing to a consultant. D On average, IT raining costs are not significantly more or less expensive when performed in-house compared to outsourcing to a consultant.

Explanation / Answer

a)
H0: mu1 - mu2 = 0
HA: mu1 - mu2 not equals to 0

Option A

b)
If the population means for the two types of training are actually equal, there should be an 18 out of 1000 chance of seeing difference as large as or larger than the observed difference just from natual sampling variation
Option C

c)
As p-value is less than the significance level of 0.05, we reject the the null hypothsis.
This means IT training costs are significantly different when performed in-house compared to outsourcing to a consultant.

Option A

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