The average health care costs per year for a sample of U.S. cities (50,000~200,000 population) are $586, with a sample standard deviation of $116 (n=378). Salem contends that its new outpatient treatment program reduces annual health care costs to $525 per person.
a. Calculate the t score based on these data.
b. Is this a significant improvement?
The t-score associated with alpha = 0.005 from Table 3 in the appendix is 2.576. Answer this question after comparing the calculated t score [your answer from part a] with the critical t score of 2.576