1. Ford Motor Company wishes to estimate the mean dollar amount of damage done t

Question

1. Ford Motor Company wishes to estimate the mean dollar amount of damage done to a new model Taurus as a result of a 10 mph crash into the rear bumper of a parked car. 36 Tauruses are test crashed into parked cars and the dollar amount of damage done to each is recorded. The results are:





a. Does the sample data provide evidence that the population mean amount of damage is less than $475 (using ?=0.05)? Use the 5 step hypothesis testing procedure.

1. Formulate the null and alternative hypotheses.




2. Determine the criterion for rejection or non-rejection of the null hypothesis. That is, determine the Z critical value.












3. Calculate the Z test statistic.






4. Compare the Z test statistic to the Z critical value (rejection region) and make a judgment about the null and alternative hypotheses.









5. Interpret the statistical decision in terms of the problem.







b. Compute the observed p value in the hypothesis test, and interpret this value. What does this mean?

Explanation / Answer

Given n=36, no data

The test hypothesis is
Ho: =475
Ha: <475

Given a=0.05, the Z critical value is Z(0.05)=-1.645 (check standard normal table)

Related Questions

Navigate

• Browse (All)
• Browse 1
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.