Wall Street securities firms paid out record year-end bonuses of $125,500 per employee for 2005 (_Fortune, _February 6, 2006). Suppose we would like to take a sample of employees at the Jones & Ryan securities firm to see whether the mean year-end bonus is different from the reported mean of $125,500 for the population. A. State the null and alternative hypotheses you would use to test whether the year-end bonuses paid by Jones & Ryan were different from the population mean. B. Suppose a sample of 40 Jones & Ryan employees showed a sample mean year-end bonus of $118,000. Assume a population standard deviation of _Σ_ =$30,000 and compute the _p_-value. C. With _α _= .05 as the level of significance, what is your conclusion? D. Repeat the preceding hypothesis test using the critical value approach.

Wall Street securities firms paid out record year-end
bonuses of $125,500 per employee for 2005 (_Fortune, _February 6,
2006). Suppose we would like to take a sample of employees at the
Jones & Ryan securities firm to see whether the mean year-end bonus is
different from the reported mean of $125,500 for the population.

 

A. State the null and alternative hypotheses you would use to
test whether the year-end bonuses paid by Jones & Ryan were different
from the population mean.

B. Suppose a sample of 40 Jones & Ryan employees showed a
sample mean year-end bonus of $118,000. Assume a population standard
deviation of _Σ_ =$30,000 and compute the _p_-value.

C. With _α _= .05 as the level of significance, what is your
conclusion?

D. Repeat the preceding hypothesis test using the critical value
approach.