Determine the most appropriate hypothesis test to use for the following scenario:

Each year, Kiplinger's compiles its list of Best Value Cities. One of the statistics used in the rankings is the cost-of-living index compiled by the US Department of Labor Bureau of Labor Statistics. The index measures the cost of living in a city relative to the national average of 100. In 2011, Pueblo Colorado had the lowest index (84), while New York City had an index of 118. The following lists the cost of living for seven Southeastern US cities:

City Cost of Living (US mean=100)

Charlotte, NC 93.0

Birmingham, AL 89.6

Florence, SC 100.0

Tampa, FL 92.1

Atlanta, GA 95.2

Knoxville, TN 89.7

Miami, FL 107.7

Is the true mean cost of living index for Southern US cities lower than the national mean cost-of-living index of 100? Test at 2% significance level.

The most appropriate hypothesis test is:

a. z - test for single population mean

b. t test for single population mean

c. z-test for single sample

d. t-test for single sample

e. z test for single population proportion

What is the correct Ho and HA statements?