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15 February, 00:09

We want to use this information to determine if there is an effect of friendship. In other words, is the mean price when buying from a friend the same as (or different from) the mean price when buying from a stranger? Assume the two groups have the same population standard deviation, and use significance level 0.05. Suppose that mu1 is the true mean price when buying from a friend and mu2 is the true mean price when buying from a stranger. (a) What are the null and alternative hypotheses?

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  1. 15 February, 03:07
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    H0 : mu1 = mu2

    Ha : mu1 ≠ mu2

    Which means

    Null hypothesis H0; the true mean price when buying from a friend mu1 and the true mean price when buying from a stranger mu2 is the same/equal

    Alternative hypothesis Ha; the true mean price when buying from a friend mu1 and the true mean price when buying from a stranger mu2 is different (not equal)

    Step-by-step explanation:

    The null hypothesis (H0) tries to show that no significant variation exists between variables or that a single variable is no different than its mean (i. e it tries to prove that the old theory is true). While an alternative Hypothesis (Ha) attempt to prove that a new theory is true rather than the old one. That a variable is significantly different from the mean.

    Therefore, for the case above;

    H0 : mu1 = mu2

    Ha : mu1 ≠ mu2

    Which means

    Null hypothesis H0; the true mean price when buying from a friend mu1 and the true mean price when buying from a stranger mu2 is the same/equal

    Alternative hypothesis Ha; the true mean price when buying from a friend mu1 and the true mean price when buying from a stranger mu2 is different (not equal)
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