Question: Suppose the federal government proposes to give a substantial tax break to automakers producing midsize cars that get a mean mileage exceeding 31 mpg. A sample of 49 midsize cars showed a mean of 31.5 mpg, with a standard deviation 0.8. [use Excel- Megastat, hypothesis tests, mean v hypothesized value, z-test or use Phstat, one-sample tests, z test for the mean, sigma known. See the model example in the week 1 lecture - one population test for a large sample]

A) Write H_o and H_{1 in mathematical format}.

B) Is this a right-tail, left-tail or two-tail test?

C) What is the critical value at a = 0.05 level?

D) State the decision rule.

E) Compute the test statistic.

F) What is your decision regarding Ho? Accept or Reject?

G) What is the p-value? [To get the p-value for one-tailed test, first get the probability value using the computed Z value in the standard normal table or use the web-based p-value calculator at http://www.graphpad.com/quickcalcs/PValue1.cfm. To get the p-value for two-tailed test multiple the result by 2]

H) What is your conclusion?

I) What do you recommend ¿ Should the federal government give a tax break to automakers or not?