The average gasoline price of one of the major oil companies in Europe has been

Question

The average gasoline price of one of the major oil companies in Europe has been $1.25 per liter. Recently, the company has undertaken several efficiency measures in order to reduce prices. Management is interested in determining whether their efficiency measures have actually reduced prices. A random sample of 64 of their gas stations is selected and the average price is determined to be $1.20 per liter with the standard deviation of $0.14. The value of the test statistic for this hypothesis test is

Explanation / Answer

              
X = sample mean =    1.2          
uo = hypothesized mean =    1.25          
n = sample size =    64          
s = standard deviation =    0.14          
              
Thus, z = (X - uo) * sqrt(n) / s =    -2.857142857 [ANSWER]          
              

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