A restaurant owner is concerned about the consistency of business. He wants to determine if the standard deviation of the profits for each week is less than $300. The profits from last week are listed below (in dollars). Assume that profits are normally distributed.
1,825 1,642 1,675 1,553 1,925 2,037 1,902
a. State the appropriate null and alternative hypotheses for the test.
b. Use the critical value approach to test the owner's concern at α = 0.01.
c. Calculate the value of the test statistic.
d. Repeat the test at α = 0.10.