A Sample of 64 Account Balances from a Credit Company

question 111

Essay

A sample of 64 account balances from a credit company showed an average daily balance of $1,040. The standard deviation of the population is known to be $200. We are interested in determining if the mean of all account balances (i.e., population mean) is significantly different from $1,000.
a.Develop the appropriate hypotheses for this problem.
b.Compute the test statistic.
c.Compute the p-value.
d.Using the p-value approach at 95% confidence, test the above hypotheses.
e.Using the critical value approach at 95% confidence, test the hypotheses.

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Definitions:

Capital Items

Long-term assets acquired for the purpose of generating income, not intended for resale in the normal course of business.

Regular Course

The usual manner or routine followed in conducting business or academic activities under normal circumstances.

Performance

The execution of an action or the operation of a machine, system, or organization, and how well it accomplishes intended tasks or goals.

Description by Brand

The detailed information or specifications of products provided, highlighting characteristics or features associated with a particular brand.