Question: Fair Market Rent

According to the document Out of Reach, published by the National Low Income Housing Coalition, the fair market rent (FMR) for a two-bedroom unit in a certain area is $692. Assume that you have collected a sample of monthly rent for 32 randomly selected units, which yielded the following data:

Monthly Rent for Two-Bedroom Units

a. Describe the data:

Calculate the mean, standard deviation, and any other statistics you wish for the data.

Create a graphic presentation of the data (you may choose to do a dotplot, histogram, box-and-whisker plot, or other plot of your choice).

Briefly comment about the data, and use the statistics and graph to describe monthly rental costs in this area.

b. Create a 95% confidence interval for the mean monthly rent for two-bedroom units in this area. Be sure to include a verbal statement of what the confidence interval means.

c. On the basis of your work in Parts 1.a and 1.b, you suspect that monthly rents in this area may be higher than the FMR of $692.

? State your hypothesis and test it at a 5% level of significance.

? Show your work for this test, state your conclusion, and explain your answer.