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14 February, 10:20

Recall that the owner of a local health food store recently started a new ad campaign to attract more business and wants to know if average daily sales have increased. Historically average daily sales were approximately $2,700. The upper bound of the 95% range of likely sample means for this one-sided test is approximately $2,843.44. If the owner took a random sample of forty-five days and found that daily average sales were now $2,984, what can she conclude at the 95% confidence level?

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  1. 14 February, 11:39
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    The answer to the given problem is provided below.

    Step-by-step explanation:

    She can make the conclusion at 95% confidence level that average sales have increased:

    Since the sample mean, $2,984, falls outside the range of likely sample means (which has an upper bound=$2,843.44), the store owner can reject the null hypothesis that μ≤ $2,700 μ≤ $2,700 at a 95% confidence level.

    Since she can reject the null hypothesis, she can essentially accept the alternative hypothesis and conclude the average daily sales have increased.
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