According to the National Association of Colleges and Employers, the average starting salary of 2014 college graduates with a bachelor’s degree was $45,473 (www.naceweb.org). A random sample of 1000 recent college graduates from a large city showed that their average starting salary was $44,930. Suppose that the population standard deviation for the starting salaries of all recent college graduates from this city is $7820.
a. Find the p-value for the test of hypothesis with the alternative hypothesis that the average starting salary of recent college graduates from this city is less than $45,473. Will you reject the null hypothesis at α = .01? Explain. What if α = .025?
b. Test the hypothesis of part a using the critical-value approach. Will you reject the null hypothesis at α = .01? What if α = .025?