Question

A freelancer, who specializes in digital marketing, is interested in the average amount of money small businesses spend on pay per click advertising. In previous years, less than 3300 dollars, on average, is spent on pay per click annually. The digital marketing freelancer suspects this average has increased in recent years.
1. If the digital marketing freelancer chooses to use a critical value approach for their hypothesis test, what do they need to calculate in order to compare with the critical value?

Answer 1

Answer:

The freelancer needs to calculate the value of the observed test statistic - average annual pay per click advertising cost - in order to compare with the critical value.

Step-by-step explanation:

His hypothesis test will be:

Null hypothesis: Average Annual Pay per click advertising cost is still less than 3300 dollars

(Note: the null hypothesis is the fact that the experimenter wishes to refute)

Alternative Hypothesis: Average annual pay per click advertising cost is now above 3300 dollars

(Alternative hypothesis is the fact that the experimenter expects to be true)

The Critical Value is a cutoff value for which if the value of the observed test statistic exceeds it, the null hypothesis is refuted and if the value of the observed test statistic is below it, the null hypothesis remains.

That is, either the freelancer accepts that the cost has not risen or he accepts that the cost has risen.