Discuss whether there is change in the test statistic

Reference no: EM133357584

(a) The starting salary of Bachelor of Business graduates in Australia is known to be normally distributed. An Australian university claims that the average starting salary of its graduates has increased since 2017. The average salary in 2017 was $55,000. A sample of 36 graduates were chosen from the batch of 2021. The average salary and the standard deviation in the sample was found to be $56,600 and $4,800 respectively. A prospective student wishes to investigate the University's claim at 1% level of significance. Use the following 6 step procedure to arrive at your conclusion.
Step 1. Statement of the hypotheses
Step 2. Test statistic and the standardised test statistic (0.5 mark)
Step 3. Level of significance (0.5 mark)
Step 4. Decision rule (2 marks)
Step 5. Computation of the value of the test statistic
Step 6. Conclusion

(b) Consider the same question in part (a). Suppose that the population standard deviation is known to be $4.500. Using this additional information repeat the test at the 1% level of significance that the average salary has increased? Answer the following questions to arrive at your conclusion.
I. Test statistic and its sampling distribution
II. Discuss whether there is change in the test statistic and/or its sampling distribution compared to part (a)
III. Decision rule based on the standardised test statistic
IV. value of the test statistic and Conclusion

Reference no: EM133357584

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