If an economist wishes to determine whether there is evidence that average family income in a community exceeds $25,000.The best null hypothesis is:
A)μ = 25,000.
B)μ 25,000.
C)μ ≤ 25,000.
D)μ ≥ 25,000.

Question

If an economist wishes to determine whether there is evidence that average family income in a community exceeds $25,000.The best null hypothesis is:
A)μ = 25,000.
B)μ > 25,000.
C)μ ≤ 25,000.
D)μ ≥ 25,000.

Quizplus · Accepted Answer

The null hypothesis should always assume no effect or difference, therefore assume average family income is equal to or less than $25,000. So the best choice is C) μ ≤ 25,000. If there is sufficient evidence to reject the null hypothesis, then the alternative hypothesis (which assumes there is an effect or difference) can be supported.

If an Economist Wishes to Determine Whether There Is Evidence