A Company Manager Thinks He Is Overpaying for Fertilizer at $174

question 26

Short Answer

A company manager thinks he is overpaying for fertilizer at $174 per ton. To find out, he collects fertilizer prices per ton from five distributors. Construct a 90% confidence interval from his results: 128, 140, 170, 166, and 156.

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Definitions:

Null Hypothesis

A statement suggesting that there is no significant difference or relationship in the data being analyzed.

Critical Value

A threshold value that is compared with the test statistic to determine whether to reject the null hypothesis in hypothesis testing.

Null Hypothesis

A statement that there is no effect or no difference, and it serves as the default assumption to be tested against an alternative hypothesis in statistical analysis.