A country club decided to increase the required monthly minimum that members mus

Question

A country club decided to increase the required monthly minimum that members must spend on food from $35 per month to $50 per month in an effort to get the members to spend more money at the club. Prior to the change, the average amount members spent on food per month was $185. Since the change 18 months ago, the average spent on food per month is now $195 with a standard deviation of $45. When testing the hypothesis (at the 5% level of signficance) that the average spent on food has increased, what is the critical value? (please round your answer to 3 decimal places)

Explanation / Answer

When testing the hypothesis (at the 5% level of signficance) that the average spent on food has increased, what is the critical value?

By the word "increased", we know it is a right tailed test.

Hence, using a z test with 0.05 level, the critical value is, by table/technology,

zcrit = 1.645 [ANSWER]

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