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SMMD Assignment 3

This document contains summaries for two hypothesis tests on house price and average living area data: 1. A hypothesis test was conducted to determine if the average house price is greater than $150,000. The null hypothesis that the average is less than or equal to $150,000 was rejected since the p-value was less than 0.05, providing evidence that the average price is actually greater than $150,000. 2. A test was also run on the claim that average living area is more than 1,800 square feet. In this case, the null hypothesis that the average is less than or equal to 1,800 square feet could not be rejected since the p-value was greater than 0

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Shubham Chauhan
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505 views2 pages

SMMD Assignment 3

This document contains summaries for two hypothesis tests on house price and average living area data: 1. A hypothesis test was conducted to determine if the average house price is greater than $150,000. The null hypothesis that the average is less than or equal to $150,000 was rejected since the p-value was less than 0.05, providing evidence that the average price is actually greater than $150,000. 2. A test was also run on the claim that average living area is more than 1,800 square feet. In this case, the null hypothesis that the average is less than or equal to 1,800 square feet could not be rejected since the p-value was greater than 0

Uploaded by

Shubham Chauhan
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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SMMD Assignment-3 Name: Shubham Chauhan l PGID: 61910037

1. Summary report for House Prices:

1.Price Statistics 2. Price Histogram with Normal Plot 3. Test Hypothesis

Hypothesis Test:
1. Null Hypothesis: Ho: µ<=150,000
2. Alternate: Ha : µ>150,000
3. P Value < 0.001 (This is less than level of significance i.e 0.05)

Observations/Comments –
• Since p-value is less than 0.05, we can reject the null hypothesis. It means that alternate
hypothesis is good to investigate further. (Average price is greater than $150,000)
• The value of p-value less than 0.05 means that we have enough evidence to reject the null
hypothesis. It also shows the probability of committing Type-1 error.
2. Summary report for Average living area:
Friend claimed that the average living area is more than 1800ft2

Hypothesis Test:
1. Null Hypothesis: Ho: µ<=1800
2. Alternate: Ha : µ>1800
3. P value – 0.3563 (This value is greater than 0.05 and hence null hypothesis cannot be
rejected)

Observations/Comments –
• Since p-value is greater than 0.05, we cannot reject the null hypothesis.
• The value of p-value greater than 0.05 means that we don’t have enough evidence to reject
the null hypothesis. Hence, we can believe that the claim being living area greater than
1800ft2 is not true

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