Individuals filing federal income tax returns prior to March 31 received an aver
ID: 3066017 • Letter: I
Question
Individuals filing federal income tax returns prior to March 31 received an average refund of $1056. Consider the population of "last-minute" filers who mail their tax return during the last five days of the income tax period (typically April 10 to April 15).
a. A researcher suggests that a reason individuals wait until the last five days is that on average these individuals receive lower refunds than do early filers. Develop appropriate hypotheses such that rejection of H0 will support the researcher's contention.
c. Using = .05, can you conclude that the population mean refund for "last minute" filers is less than the population mean refund for early fliers?
Answer the next three questions using the critical value approach.
***Red I had incorrect
Explanation / Answer
b)
x = 910 , s = 1600 , mean = 1056 , n =400
z = ( x - mean) / ( s/sqrt(n))
= ( 910 - 1056) / (1600/sqrt(400))
= -1.825
p value is calculated using z = -1.825 at 0.05 significance level
P value = 0.034
d)
critical value for test statistic = -1.645
Reject H0 if z < -1.645 (as this is left tail test)