Access the hourly wage data on the below Excel Data File (Hourly Wage). An economist wants to test if the average hourly wage is less than $29.
Hourly EDUC EXPER AGE Gender
Wage
37.85 11 2 40 1
21.72 4 1 39 0
34.34 4 2 38 0
21.26 5 9 53 1
24.65 6 15 59 1
25.65 6 12 36 1
25.45 9 5 45 0
20.39 4 12 37 0
29.13 5 14 37 1
27.33 11 3 43 1
28.02 8 5 32 0
20.39 9 18 40 1
24.18 7 1 49 1
17.29 4 10 43 0
15.61 1 9 31 0
35.07 9 22 45 0
40.33 11 3 31 1
20.39 4 14 55 0
16.61 6 5 30 1
16.33 9 3 28 0
23.15 6 15 60 1
20.39 4 13 32 0
24.88 4 9 58 1
23.88 5 4 28 0
37.65 6 5 40 1
15.45 6 2 37 0
26.35 4 18 52 1
19.15 6 4 44 0
16.61 6 4 57 0
18.39 9 3 30 1
25.45 5 8 43 0
28.02 7 6 31 1
23.44 4 3 33 0
17.66 6 23 51 1
26.33 4 15 37 0
34.34 4 9 45 0
35.45 6 3 55 0
37.43 5 14 57 0
35.89 9 16 36 1
20.39 4 20 60 1
31.81 4 5 35 0
35.45 9 10 34 0
37.66 5 4 28 1
23.87 6 1 25 0
36.35 7 10 43 1
25.45 9 2 42 1
23.67 4 17 47 0
26.02 11 2 46 1
23.15 4 15 52 0
24.18 8 11 64 0
a) Choose the null and the alternative hypotheses for the test.
A. H0:μ≥29;HA:μ<29
B. H0:μ=29;HA:μ≠29
C. H0:μ≤29;HA:μ>29
b) Use the Excel function Z. TEST to calculate the p-value. Assume that the population standard deviation is $6.
c) At α = 0.01 what is the conclusion?
A. Do not reject H0; the hourly wage is not less than $29.
B. Do not reject H0; the hourly wage is less than $29.
C. Reject H0; the hourly wage is not less than $29.
D. Reject H0; the hourly wage is less than $29.

Answer:

A. H0:μ≥29;HA:μ<29

Pvalue < 0.01

D. Reject H0; the hourly wage is less than $29

Step-by-step explanation:

The null hypothesis will negate the claim which will be the hypothesis to be tested. Therefore, since the claim is to test if hourly wage is less Than 29 ; then the null will be that hourly wage is equal to or greater than 29

H0:μ≥29;HA:μ<29

The Pvalue measure the probability that the extremity of our finding against a certain α level. The Pvalue obtained using the Excel function should be 0.00058

When Pvalue is < α ; We reject the null hypothesis

Hence, Reject H0; the hourly wage is less than $29 and conclude that hourly wage is less Than $29

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