Question: Based on the sample data below, is the average Medicare spending in the northern region significantly less than the average spending in the southern region

Based on the sample data below, is the average Medicare spending in the northern region significantly less than the average spending in the southern region at the 1 percent level?
(a) State the hypotheses and decision rule.
(b) Find the test statistic assuming unequal variances.
(c) State your conclusion. Is this a strong conclusion?
(d) Can you suggest reasons why a difference might exist?

Medicare Spending per Patient (adjusted for age, sex, and race) Statistic Northern Region Southern Region Sample mean Sample standard deviation Sample size $3,123 $1,546 14 patients $8,456 $3,678 16 patients

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