Scenario

You have been hired by the Regional Real Estate Company to help them analyze real estate data. One of the companys Pacific region salespeople just returned to the office with a newly designed advertisement. It states that the average cost per square foot of his home sales is above the average cost per square foot in the Pacific region. He wants you to make sure he can make that statement before approving the use of the advertisement. The average cost per square foot of his home sales is $275. In order to test his claim, you collect a sample of 1,001 home sales for the Pacific region. Design a hypothesis test and interpret the results using significance level = .05.

Calculations: Calculate the p value, describe the p value and test statistic in regard to the normal curve graph, discuss how the p value relates to the significance level, and compare the p value to the significance level to reject or fail to reject the null hypothesis.

• Determine the appropriate test statistic, then calculate the test statistic. Note: This calculation is (mean target)/standard error. In this case, the mean is your regional mean (Pacific), and the target is 275.
• Calculate the p value. Note: For right-tailed, use the T.DIST.RT function in Excel, left-tailed is the T.DIST function, and two-tailed is the T.DIST.2T function. The degree of freedom is calculated by subtracting 1 from your sample size. Choose your test from the following: =T.DIST.RT([test statistic], [degree of freedom]) =T.DIST([test statistic], [degree of freedom], 1) =T.DIST.2T([test statistic], [degree of freedom])
• Using the normal curve graph as a reference, describe where the p value and test statistic would be placed.

• Test Decision: Discuss the relationship between the p value and the significance level, including a comparison between the two, and decide to reject or fail to reject the null hypothesis.
  • Discuss how the p value relates to the significance level.
  • Compare the p value and significance level, and make a decision to reject or fail to reject the null hypothesis.

• Conclusion: Discuss how your test relates to the hypothesis and discuss the statistical significance.
  • Explain in one paragraph how your test decision relates to your hypothesis and whether your conclusions are statistically significant.

Descriptive Summary Statistics
Mean	1894.86685
Standard Error	7.56548222
Median	1872
Mode	1840
Standard Deviation	239.361145
Sample Variance	57293.7577
Kurtosis	0.32374841
Skewness	0.08179421
Range	1486
Minimum	1185
Maximum	2671
Sum	1896761.71
Count	1001