14. A res taurant ow n e r is c on c e rn ed a b o u t th e c o n s i s t en cy o f bus ines s . He w a n t s to d e te rmin e if th e s tandard deviat ion o f th e profits for e a ch w e e k is less than $ 3 0 0 . The profits from last w e e k are listed b e low (in dollars). A s sume that profits are normal ly d istributed.

1,825 1,642 1,675 1,553 1,925 2,037 1,902

a. State th e appropriate null and alternat ive h y p o th e s e s for th e test .

b. Comp u te th e v alue o f th e t e s t statis tic .

c. Use th e critical v alue approach to te s t th e owner's conc e rn at a = 0.01.

d. Repeat th e t e s t at a = 0 . 1 0 .