The average cost of tuition, room and board at small private liberal arts colleges is reported to be $8,500 per term, but a financial administrator believes that the average cost is higher. A study conducted using 350 small liberal arts colleges showed that the average cost per term is $8,745 with a standard deviation of $1,200. Let = 0.05. What is the p-value for this test?
A) 0.0000
B) 0.0124
C) 0.0500
D) 0.4938

Question

Quizplus · Accepted Answer

The p-value for this test is 0.0000. This is because the z-score for this test is (8745-8500)/1200 = 2.04, and the corresponding p-value is 0.0000.

The Average Cost of Tuition, Room and Board at Small