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Sample Hypothesis Testing Paper

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Sample Hypothesis Testing Paper
RES/342

Two-Sample Hypothesis Research Question
A company decides to purchase homes to rent out to their employees. They have to decide if purchasing homes in a rural area is cheaper than purchasing homes from the inner city. 15 miles from the center of the city is inner city and anything passed 15 miles is rural area. The mean house pricing in the urban area is $232,736 out of a sample size of 59 with a standard deviation of $48,651. The mean house pricing in the rural area is $206,183 out of a sample size of 46 with a standard deviation of $40,896. At the 0.05 significance level, the company assumes that urban area is higher than rural area.
Formulating a Verbal and Numeric Hypothesis
To formulate a verbal and numerical hypothesis statement one must determine which type of two-sample statistic test the problem describes. The statement indicates that one would perform a right-tailed test. The words “is higher than” indicates that the alternate hypothesis will have the greater than sign in it. The statement also indicates that the standard deviation is known. Using this knowledge one may begin to formulate a verbal hypothesis. The researchers will test the hypothesis statement and try to find sufficient evidence to support the null hypothesis. If the evidence is insufficient one will reject the null hypothesis. If the evidence is sufficient one may fail to reject the null hypothesis. Simply put one is trying to figure out if the company purchasing a home in an urban area will cost more than purchasing a home in a rural area. The company will use statistical data and formulas to present evidence that will either help to determine whether the null hypothesis that mean housing price in the urban area is greater than the mean price of homes in the rural area is an acceptable statement. Expressing this statement in a

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