A financial analyst of a company that operates internationally believes that real estate office space in London is more expensive that in Paris.
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A financial analyst of a company that operates internationally believes that real estate office space in London is

more expensive that in Paris. To test his opinion samples of 40 office spaces, of similar characteristics, are selected in both locations and provided the results summarized below. Prices are in $ per square meter. Use α = 0.05 to test the claim.


London Paris

Sample Size 40 40

Sample men 400 380

Sample Standard Dev. 150 120



1)   Should the pared samples or the independent samples procedure be used?

2)   Should T values or Z values be used?

3)   State the alternate hypothesis:

4)   What is the value of the critical point?

5)   What is the value of the test statistic?

6)   Do you reject the null hypothesis?

7)   Us the analyst's opinion proven correct?

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