The Employees at the East Vancouver Office of a Multinational

question 13

Multiple Choice

The employees at the East Vancouver office of a multinational company are demanding higher
Salaries than those offered at the company office located in Oshawa Ontario. Their justification for
The pay difference is that the difference between the average price of single-family houses in East
Vancouver and that in Oshawa is more than $60,000. Before making a decision, the company
Management wants to study the difference in the prices of single-family houses for sale at the two
Locations.
The results of their search of recent house sales are as follows (in $000, rounded to the nearest
Thousand) :
Assuming that the population distributions are approximately normal, can we conclude at the 0.05
Significance level that the difference between the two population means is greater than $60,000?
What is the decision at the 5% level of significance?

• A) Fail to reject the null hypothesis and conclude that the average house prices in East Vancouver are not more than $60,000 greater than those in Oshawa.
• B) Reject the null hypothesis and conclude that the average house prices in East Vancouver are not more than $60,000 greater than those in Oshawa.
• C) Reject the null hypothesis and conclude that the average house prices in East Vancouver are indeed at least $60,000 greater than those in Oshawa.
• D) Fail to reject the null hypothesis and conclude that the average house prices in East Vancouver are more than $60,000 greater than those in Oshawa.

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Definitions:

Patellar Reflex

A reflex action of the leg resulting from a sharp tap on the patellar tendon, used to test the nervous system's response.

Reflex

An involuntary and nearly instantaneous movement in response to a stimulus.

Normal

Conforming to a standard; usual, typical, or expected state or condition.

Abstract Thinking

The cognitive ability to understand concepts that are not directly tied to concrete physical objects or experiences.