Grumney Family Restaurant Ms. Brigden Tips – Solution Guide

At the time she was hired as a server at the Grumney Family Restaurant, Beth Brigden was told, “You can average $70 a day in tips.” Assume the population of daily tips is normally distributed with a standard deviation of $3.46. Over the first 32 days she was employed at the restaurant, the mean daily amount of her tips was $71.08. At the 0.02 significance level, can Ms. Brigden conclude that her daily tips average more than $70?

Solving the problem in Excel

Look closely at the formulas in the cells below. The sample size corresponds to the number of days, while the probability is level the tips should be over – in this case it is $70.

Grumney Family Restaurant and Beth Brigden

Grumney Family Restaurant excel formulas setup for solution.

State the null hypothesis and the alternate hypothesis.

H0: μ ≥ 70 ; H1: μ < 70

State the decision rule.

Reject H0 if z > 2.05

Compute the value of the test statistic.

1.77

What is your decision regarding H0?

Reject H0

What is the p-value?

0.0387

 

 
  • Student: Not Provided
  • Textbook: Statistical, Techniques in Business & Economics
  • Course: QNT 351
 
 

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