A rental agent states that the average rent for a studio apartment in
Shadyside is $750 A sample of 12 renters shows that the mean is $732 and
the standard deviation is $17. Is there enough evidence to reject the agent's
claim? Use a = .01

Question

A rental agent states that the average rent for a studio apartment in
Shadyside is $750 A sample of 12 renters shows that the mean is $732 and
the standard deviation is $17. Is there enough evidence to reject the agent's
claim? Use a = .01

amistre64 · Answer

use a 99% confidence interval ....

amistre64 · Answer

$$732\pm Z_{99\%}(\frac{17}{\sqrt{12}})$$
if 750 is within that range then you must fail to reject it

amistre64 · Answer

or you can use the Pvalue stuff$$z=\frac{750-732}{17}\sqrt{12}$$

amistre64 · Answer

3.67 seems to be beyond the limits to me at first glance; but thats just a guess at the moment .. whats the z score for 99.5% ?