An entrepreneur is considering the purchase of a coin-operated laundry. The current owner claims that over the past 5 years, the average daily revenue was $675 with a standard deviation of $75. A sample of 30 days reveals a daily average revenue of $625 and a standard deviation of $70. Which of the following tests will be the most appropriate?
A) t test for mean
B) Z test for proportion
C) pooled-variance t test
D) separate-variance t test

Question

Quizplus · Accepted Answer

The appropriate test in this scenario would be a t test for mean since we are comparing the sample mean to the population mean. We do not have information about the population standard deviation, so we cannot use a Z test for proportion. Additionally, we only have one sample and do not need to compare two independent samples or proportions, so we do not need to use a pooled or separate-variance t test.

An Entrepreneur Is Considering the Purchase of a Coin-Operated Laundry