A steel company is considering the relocation of one of itsmanufacturing plants. The company’s executives have selected fourareas that they believe are suitable locations. However, they wantto determine if the average wages are significantly different inany of the locations, since this could have a major impact on thecost of production. A survey of hourly wages of similar workers ineach of the four areas I performed with the following results.
| Hourly Wages ($) |
| Area 1 | Area 2 | Area 3 | Area 4 |
1 | 11 | 15 | 13 | 20 |
2 | 12 | 16 | 14 | 16 |
3 | 11 | 18 | 15 | 18 |
4 | 13 | 17 | 15 | 17 |
5 | 10 | 14 | 12 | 16 |
a. Do the data indicate a significant difference among theaverage hourly wages in the four areas? Construct the 10 steps ofhypothesis testing using ? = 0.05 to answer the question.
b. What assumptions were mad in performing the test in part a?Do the data appear to satisfy these assumptions? Explain.
