Question

Sports Stadiums and Home Values. In the paper "Housing Values Near New Sporting Stadiums" (Land Economics, Vol. 81 , Issue 3, pp. 379-395), C. Tu examined the effects of construction of new sports stadiums on home values. Suppose that you want to use a paired sample to decide whether construction of new sports stadiums affects the mean price of neighboring homes.

a. identify the variable.

b. identify the two populations:

c. identify the pairs

d. identify the paired-diffenence variable.

e. determine the null and allernative hypotheses.

f. classify the hypothesis test as nwo tailed, left tailed, or right tailed.

Short answer

Part a) Here, we identify the variable is "home price" of Americans.

Part b)We identify the two populations, which are homes neighboring and homes not neighboring newly constructed sports stadiums

Part c) pair of comparable homes, neighboring and not neighboring a newly constructed sports stadium

Part d)is the difference between the prices of a pair of comparable homes neighboring and not neighboring a newly constructed sports stadiums.

Part e)Defination provided

Part f)Defination provided

Step-by-step solution

Step 1:Given information

Sports Stadiums and Home Values. In the paper "Housing Values Near New Sporting Stadiums" (Land Economics, Vol. 81 , Issue 3, pp. 379-395), C. Tu examined the effects of construction of new sports stadiums on home values. Suppose that you want to use a paired sample to decide whether construction of new sports stadiums affects the mean price of neighboring homes.

Step 2:Explaination Part a)

Here, we identify the variable is "home price" of Americans.

Step 2:Explaination Part b)

We identify the two populations, which are homes neighboring and homes not neighboring newly constructed sports stadiums.

Step 2:Explaination Part c)

We identify the matched pairs are a pair of comparable homes, neighboring and not neighboring a newly constructed sports stadiums.

Step 2:Explaination Part d)

We identify the paired-difference variable is the difference between the prices of a pair of comparable homes neighboring and not neighboring a newly constructed sports stadiums.

Step 2:Explaination Part e)

(e) Let ${\mu }_1$and ${\mu }_2$denote the mean price of homes neighboring and not neighboring a newly constructed sports stadium.

The null and alternative hypotheses are

$H_0$: mean prices of neighboring homes and not neighboring homes are the same

$\text{(or)}{H}_0:{\mu }_1={\mu }_2$

$H_{\mathrm{a}}$: mean prices of neighboring homes and not neighboring homes are not the same

$\text{(or)}{H}_2:{\mu }_1\ne {\mu }_2$

Step 2:Explaination Part f)

The alternative hypothesis states that

$H_{\mathrm{a}}$: mean prices of neighboring homes and not neighboring homes are not the same

$\text{(or)}{H}_{\mathrm{a}}:{\mu }_1\ne {\mu }_2$

Mean price of neighboring homes and not neighboring homes are different, which reveals that it is a two-talled test.