In One Area, Monthly Incomes of College Graduates Have a Standard

question 141

Essay

In one area, monthly incomes of college graduates have a standard deviation of $650. It is believed that the
standard deviation of monthly incomes of non-college graduates is higher. A sample of 71 non-college
graduates are randomly selected and found to have a standard deviation of $950. Test the claim that
non-college graduates have a higher standard deviation. Use $\alpha$ = 0.05.

---

Definitions:

Price

The cost anticipated, necessary, or paid out in return for acquiring something.

Long-Run Price

The price level at which economic forces such as supply and demand are balanced over a longer time frame, considering all inputs are variable.

Output

The amount of goods or services produced by a business, industry, or economy within a given period.

Perfectly Competitive Industry

A perfectly competitive industry is a market structure where many firms offer identical products, there are no barriers to entry or exit, and each firm has no influence over the market price.