More than 200,000 people worldwide take the GMAT examination each year as they apply for MBA programs. Their scores vary Normally with mean about Î¼ = 525 and standard deviation about Ïƒ = 100. One hundred students
go through a rigorous training program designed to raise their GMAT scores. Test the hypotheses
H0 : Î¼ = 525
Ha : Î¼ > 525
in each of the following situations:
(a) The studentsâ€™ average score is x = 541.4. Is this result significant at the 5% level?
(b) The average score is x = 541.5. Is this result significant at the 5% level? The difference between the two outcomes in (a) and (b) is of no importance. Beware attempts to treat Î± = 0.05 as sacred.