Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

An economist studying inflation in electricity prices in 2018 and 2019 believes that the average price of electricity, even after adjusting for inflation, changed between

An economist studying inflation in electricity prices in 2018 and 2019 believes that the average price of electricity, even after adjusting for inflation, changed between these two years. To test his claim, he samples 9 different counties and records the average price of electricity in each county from each year. He then adjusts the prices for inflation. His results are given in the following table. Test the economist's claim at the 0.02 level of significance assuming that the population distribution of the paired differences is approximately normal.Let prices in 2018 be Population 1 and prices in 2019 be Population 2.

2018 2019
12.62 11.24
16.01 17.99
12.59 14.44
19.94 21.43
17.75 19.24
15.91 17.39
18.89 19.94
15.85 16.67
13.90 15.31

Step3of3:

Draw a conclusion and interpret the decision.

A.) We reject the null hypothesis and conclude that there is insufficient evidence at a 0.02 level of significance to support the claim that the average price of electricity, even after adjusting for inflation, changed between 2018 and 2019.

B.) We reject the null hypothesis and conclude that there is sufficient evidence at a 0.02 level of significance to support the claim that the average price of electricity, even after adjusting for inflation, changed between 2018 and 2019.

C.) We fail to reject the null hypothesis and conclude that there is sufficient evidence at a 0.02 level of significance to support the claim that the average price of electricity, even after adjusting for inflation, changed between 2018 and 2019.

D.) We fail to reject the null hypothesis and conclude that there is insufficient evidence at a 0.02 level of significance to support the claim that the average price of electricity, even after adjusting for inflation, changed between 2018 and 2019.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Beginning Algebra A Text/Workbook

Authors: Charles P McKeague

2nd Edition

1483271242, 9781483271248

More Books

Students also viewed these Mathematics questions