An entrepreneur is considering the purchase of a coin-operated laundry. The current owner claims that over the past 5 years, the mean daily revenue was $675 with a standard deviation of $75. A sample of 30 days reveals a daily mean revenue of $625. If you were to test the null hypothesis that the daily mean revenue was $675 and decide not to reject the null hypothesis, what can you conclude?
A) There is not enough evidence to conclude that the daily mean revenue was $675.
B) There is not enough evidence to conclude that the daily mean revenue was not $675.
C) There is enough evidence to conclude that the daily mean revenue was $675.
D) There is enough evidence to conclude that the daily mean revenue was not $675.

Question

Quizplus · Accepted Answer

If we do not reject the null hypothesis, we cannot conclude that the daily mean revenue was exactly $675. The sample mean is lower, but it is within one standard deviation of the population mean, so it is not significantly different from it. Therefore, there is not enough evidence to conclude that the daily mean revenue was not $675 either. The correct choice is B.

An Entrepreneur Is Considering the Purchase of a Coin-Operated Laundry