A study is undertaken to determine how consumers react to energy conservation ef

Question

A study is undertaken to determine how consumers react to energy conservation efforts. A random group of 60 families is chosen. Their consumption of electricity is monitored in a period before and after the families are offered certain discounts to reduce their energy consumtion. Both periods are the same length. The difference in electric consumption between the period before and after the offer is recorded for each family. Then the average difference in consumtion and the standard devuiation of the difference are computed. The results are D(bar)=0.2KW and sd=1.0KW.At alpha=0.01,is there evidence to conclude that conservation efforts reduce consumption?

Explanation / Answer

here mean difference =0.2

and standard deviation =1.0

std error =std deviation/(n)1/2  where n=60

=0.1291

therefore tstat =mean difference/std error =0.2/0.1291 =1.549

degree of freedom =n-1 =59

for 59 df and above tstat p value =0.063

as p value is greater then 0.01 level of significance, we do not have sufficient evidence conclude that conservation efforts reduce consumption

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