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The Average Price of Homes Sold in the U

question 109

Essay

The average price of homes sold in the U.S. in the past year was $220,000. A random sample of 81 homes sold this year showed an average price of $210,000. It is known that the standard deviation of the population is $36,000. At 95% confidence test to determine if there has been a significant decrease in the average price homes.
a.State the null and alternative hypotheses to be tested.
b.Compute the test statistic.
c.Determine the critical value for this test.
d.What do you conclude?
e.Compute the p-value.


Definitions:

Factors Of Production

Inputs into the production process (e.g., labor, capital, and materials).

Profit

The financial gain made in a transaction or operation, calculated as the difference between the revenue earned and the costs incurred.

Short Run

A time period in economic analysis during which at least one factor of production is fixed, influencing the firm's decisions on output and pricing.

Profit

The financial gain realized when the revenue generated from a business activity exceeds the expenses, costs, and taxes needed to sustain the activity.

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