Question: The mean household income in a region served by a chain of clothing stores is $48,750. In a sample of 40 customers taken at various stores the mean income of the customers was $51,505 with standard deviation $6,852.
a. Test at the 10% level of significance the null hypothesis that the mean household income of customers of the chain is $48,750 against that alternative that it is different from $48,750.
b. The sample mean is greater than $48,750, suggesting that the actual mean of people who patronize this store is greater than $48,750. Perform this test, also at the 10% level of significance. (The computation of the test statistic done in part (a) still applies here.)