Question 9.433

10. ATM Fees. Do you hate paying the extra fees imposed by banks when withdrawing funds from an automated teller machine (ATM) not owned by your bank? The Federal Reserve System reported in 2010 that the mean such fee is $1.14. A random sample of 36 such transactions yielded a mean of $1.07 in extra fees. Suppose the population standard deviation of such extra fees is $0.25.

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  1. Test, using level of significance , whether there has been a reduction in the population mean fee charged on such transactions.
  2. Which type of error is it possible that we are making, a Type I error or a Type II error? Which type of error are we certain we are not making?