10.19 A study was made to compare the costs of supporting a family of four Americans...

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10.19 A study was made to compare the costs of supporting a family of four Americans for a year in different foreign cities. The lifestyle of living in the United States on an annual income of $75,000 was the standard against which living in foreign cities was compared. A comparable living standard in Toronto and Mexico City was attained for about $64,000. Suppose an executive wants to determine whether there is any difference in the average annual cost of supporting her family of four in the manner to which they are accustomed between Toronto and Mexico City. She uses the following data, randomly gathered from 11 families in each city, and an alpha of .01 to test this difference. She assumes the annual cost is normally distributed and the population variances are equal. What does the executive find? Toronto Mexico City $69,000 $65,000 64,500 64,000 67,500 66,000 64,500 64,900 66,700 62,000 68,000 60,500 65,000 62,500 69,000 63,000 71,000 64,500 68,500 63,500 67,500 62,400 Use the data from the previous table to construct a 95% confidence interval to esti- mate the difference in average annual costs between the two cities. 10.19 A study was made to compare the costs of supporting a family of four Americans for a year in different foreign cities. The lifestyle of living in the United States on an annual income of $75,000 was the standard against which living in foreign cities was compared. A comparable living standard in Toronto and Mexico City was attained for about $64,000. Suppose an executive wants to determine whether there is any difference in the average annual cost of supporting her family of four in the manner to which they are accustomed between Toronto and Mexico City. She uses the following data, randomly gathered from 11 families in each city, and an alpha of .01 to test this difference. She assumes the annual cost is normally distributed and the population variances are equal. What does the executive find? Toronto Mexico City $69,000 $65,000 64,500 64,000 67,500 66,000 64,500 64,900 66,700 62,000 68,000 60,500 65,000 62,500 69,000 63,000 71,000 64,500 68,500 63,500 67,500 62,400 Use the data from the previous table to construct a 95% confidence interval to esti- mate the difference in average annual costs between the two cities.