The PGA and Golf Digest have developed the Play Golf America

The PGA and Golf Digest have developed the Play Golf America program, in which teaching professionals at participating golf clubs provide a free 10-minute lesson to new customers. According to Golf Digest (July 2008), golf facilities that participate in the program gain, on average, $2,400 in green fees, lessons, or equipment expenditures. A teaching professional at a golf club believes that the average gain in greens fees, lessons, or equipment expenditures for participating golf facilities exceeds $2,400.

1.) In order to support the claim made by the teaching professional, what null and alternative hypotheses should you test?

2.) Suppose you select ? = .05. Interpret this value in the words of the problem.

3.) For ? = .05, specify the rejection region of a large- sample test.

Solution

1)

Null Hypothesis: The average gain in greens fees, lessons, or equipment expenditures for participating golf facilities is less than equal to $2,400

H₀: mu <= $2,400

Alternate Hypothesis: The average gain in greens fees, lessons, or equipment expenditures for participating golf facilities exceeds $2,400

H_a: mu > $2,400

2) alpha = 0.05 implies that we test for a maximum 5% probability that the Null Hypothesis is true

Thus, if p value < alpha we reject the Null Hypothesis

3) alpha = 0.05

large sample implies we can use z statistic

Critical value for alpha = 0.05 is 1.65

Rejection region is: Reject the Null hypothesis if test stat > +1.65