The average cost for the sample of 5 sales of a product is $\bar x$ = $230 and the sample standard deviation is s = $17.50. The hypothesized mean is ?0 = $250. Compute the value of the test statistic.
A) -2.56
B) -4.00
C) -1.67
D) -3.87

Question

Quizplus · Accepted Answer

The test statistic is calculated using the formula $t = \frac{\bar x - \mu_0}{s/\sqrt{n}}$, where $\bar x$ is the sample mean, $\mu_0$ is the hypothesized mean, $s$ is the sample standard deviation, and $n$ is the sample size. Plugging in the given values, $t = \frac{230 - 250}{17.50/\sqrt{5}} = -2.56$.

The Average Cost for the Sample of 5 Sales of a Product