SMMD Assignment 3

Ramashis Biswas | PGID: 61510121 | Ramashis_Biswas2015@isb.edu

From the sample,

Average Price = $ 163862.1

Average Living Area = 1807.3 Sq Ft

For Average Price, H0 is $150000, then we can accept the claim if we can reject H0.
For Average Area, H0 is 1800, then we can accept the claim if we can reject H0.

For Price, p value is given by Prob > t .0001, i.e. the probability of finding a sample mean of
163862.1 under H0 is .0001. Since this is less than the given significance level, we have a
strong case of rejecting H0.
For Living Area, p value is .3563, which is greater than the significance level. Thus we
cannot reject H0 and further investigations is required.
Hence, we can accept the claim that the average house price is more than $ 150000. However,
the second claim still stands unproven and needs further testing.