The management of XYZ Corporation is considering relocating the corporate office to a new location outside the Capital Beltway. Management is concerned that the commute times of the employees to the new office might be too long.
The company decides to survey a sample of employees at other companies in the same office park to see how long these employees are commuting to the office. A sample of 20 employees indicated that the employees are commuting X (bar) = 39 minutes and s = 5 minutes.
a. Using the 0.05 level of significance, is there evidence that the population mean is above 35 minutes?
b. What is your answer in (a) if X (bar) = 42 minutes and s = 20 minutes?
c. Look at your answers for a and b above and discuss what you can learn from the results about the effect of a large standard deviation.