Most individuals are aware of the fact that the average annual repair cost for a

Question

Most individuals are aware of the fact that the average annual repair cost for an automobile depends on the age of the automobile. A researcher is interested in finding out whether the variance of the annual repair costs also increases with the age of the automobile. A sample of 26 automobiles 4 years old showed a sample standard deviation for annual repair costs of $190 and a sample of 25 automobiles 2 years old showed a sample standard deviation for annual repair costs of $100. Let 4 year old automobiles be represented by population 1.

State the null and alternative versions of the research hypothesis that the variance in annual repair costs is larger for the older automobiles.

Select both answers:

Conduct the hypothesis test at a .01 level of significance.

Calculate the value of the test statistic (to 2 decimals).
_____

The p-value is

_______

What is your conclusion?

______

at th ed in e. A s 0 and 0. Let s of f ost individ Select creases wit greater than or equal to eviation for equal to ess than or equal to less than not equal to Select eviation for State the larger for 2 110 : 1 2 Ha: 121 Select

Explanation / Answer

Ho: less than or equal to

Ha: greater than

value of the test statistic =(s1/s2)1/2=(190/100)2 =3.61

for (n1-1=25) ; (n2-1=24) degree of freedom ; and above test statistic ; p value =0.0012

conclusion : rejeect null hypothesis as p vlaue is less than 0.01 level

sufficient evidence to conclude that variance in annual repair costs is larger for the older automobiles.

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