Employees of a big service company have an average wage of $7.00 per hour with a

ID: 3371327 • Letter: E

Question

Employees of a big service company have an average wage of $7.00 per hour with a standard deviation of $0.50. The military industry has 64 employees of a certain ethnical group that have an average wage of $6.90 per hour. Is it resonable to suppose that the wage of the ethnical group is equivalent to that of the random sample taken from the employees from the military industry.

Trabajadores de una gran empresa de servicios tienen un salario promedio de $7.00 por hora con una desviación estándar de $.50. La industria tiene 64 trabajadores de cierto grupo étnico que tienen un salario promedio de $6.90 por hora. ¿Es razonable suponer que la tasa salarial del grupo étnico es equi- valente a la de una muestra aleatoria de trabajadores tomada de los empleados en la industria militar? Sugerencia: calcule la probabilidad de obtener una media muestral menor o igual que $6.90 por hora.] 7.45

Explanation / Answer

Result:

Employees of a big service company have an average wage of $7.00 per hour with a standard deviation of $0.50. The military industry has 64 employees of a certain ethnical group that have an average wage of $6.90 per hour. Is it reasonable to suppose that the wage of the ethnical group is equivalent to that of the random sample taken from the employees from the military industry.

Standard error = sd/sqrt(n) = 0.5/sqrt(64) =0.0625

Z value for 6.9, z =(6.9-7.0)/0.0625 = -1.6

This calculated z value is with in the limit of -2 z value and +x-2 z value.

Therefore it is reasonable to suppose that the wage of the ethnical group is equivalent to that of the random sample taken from the employees from the military industry.

Hypothesis testing approach at 5% level.

Z Test of Hypothesis for the Mean

Data

Null Hypothesis m=

Level of Significance

0.05

Population Standard Deviation

0.5

Sample Size

Sample Mean

6.9

Intermediate Calculations

Standard Error of the Mean

0.0625

Z Test Statistic

-1.6000

Two-Tail Test

Lower Critical Value

-1.9600

Upper Critical Value

1.9600

p-Value

0.1096

Do not reject the null hypothesis