The president of the American Insurance Institute wants to comparethe yearly cos

Question

The president of the American Insurance Institute wants to comparethe yearly costs of auto insurance offered by two leadingcompanies. He selects a sample of 15 families, some with only asingle insured driver, others with several teenage drivers, andpays each family a stipend to contact the two companies and ask fora price quote. To make the data comparable, certain features, suchas the deductible amount and limits of ability, are standardized.The sample information is reported below. At the .10 significancelevel, can we conclude that there is a difference in the amountsquoted?


Family Progressive Car Ins GEICO Car Ins Becker 2090 1610 Berry 1683 1247 Cobb 1402 2327 Debuck 1830 1367 DuBrul 930 1461 Eckroate 697 1789 German 1741 1621 Glasson 1129 1914 King 1018 1956 Kucic 1881 1772 Meredith 1571 1375 Obeid 874 1527 Price 1579 1767 Phillips 1577 1636 Tresize 860 1188


Family Progressive Car Ins GEICO Car Ins Becker 2090 1610 Berry 1683 1247 Cobb 1402 2327 Debuck 1830 1367 DuBrul 930 1461 Eckroate 697 1789 German 1741 1621 Glasson 1129 1914 King 1018 1956 Kucic 1881 1772 Meredith 1571 1375 Obeid 874 1527 Price 1579 1767 Phillips 1577 1636 Tresize 860 1188

Explanation / Answer

Ho: There is no difference in the amounts quoted.

Ha: There is difference in the amounts quoted.

Test statistic t: -1.7995

Critical t :±1.7011

P value : 0.0827

Df : 28

Reject Ho.

There is difference in the amounts quoted.

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