Question: Paige Thomsen is about to graduate from college at a local university in San Francisco. Her options are to look for a job in San Francisco or go home to Denver and search for work there. Recent data reports that average starting salaries for college graduates is $48,900 in San Francisco and $40,900 in Denver (Forbes, June 26, 2008). Suppose these data were based on 100 recent graduates in each city where the population standard deviation is $16,000 in San Francisco and $14,500 in Denver. For social reasons, Paige is also interested in the percent of the population who are in their 20s. The same report states that 20% of the population are in their 20s in San Francisco; the corresponding percentage in Denver is 22%.
In a report, use the sample information to:
1. Determine whether the average starting salary in San Francisco is greater than Denver's average starting salary at the 5% significance level.
2. Determine whether the proportion of the population in their 20s differs in these two cities at the 5% significance level.