An insurance company stated that in 1987, the average yearly car insurance cost for a family in the U.S. was $1188. In the same year, a random sample of 37 families in California resulted in a mean cost of x¯ = $1228 with a standard deviation of s = $21.00.
a. Does this suggest that the average insurance cost for a family in California in 1987 exceeded the national average?
b. State the appropriate null and alternative hypotheses for this question.
c. Perform the statistical test of the null hypothesis at a significance level of 5%.