Assume the cost of an extended 100,000 mile warranty for a particular SUV follow

Question

Assume the cost of an extended 100,000 mile warranty for a particular SUV follows the normal distribution with a mean of $1,280 and a standard deviation of $80. Complete parts (a) through (d) below a) Determine the interval of warranty costs from various companies that are one standard deviation around the mean The interval of warranty costs that are one standard deviation around the mean ranges from Sto (Type integers or decimals. Use ascending order.) b) Determine the interval of warranty costs from various companies that are two standard deviations around the mean. The interval of warranty costs that are two standard deviations around the mean ranges from to Type integers or decimals. Use ascending order.) c) Determine the interval of warranty costs from various companies that are threo standard deviations around the mean. The interval of warranty costs that are three standard deviations around the mean ranges from Sl to S Type integors or decimals. Use ascending arder.) d) An extended 100,000 mile warranty for this type of vehicle is advertised at $1,600. Based on the previous results, what conolusions can you make? A. The $1.600 cost of this warranty is much higher than average due to the fact that it is moro than three standard deviations above the mean. O B. This warranty is better quality than warranties offered by competing companies due to the fact that it is more thar three standard deviations above the mean. D C. The $1600 cost of this warranty must be an error in tho advertisement because a data value cannot be more than three standard de D. The $1.600 cost of his warranty is slightly higher than average due to tho fact that it s more than three standard dowiations above the mean Click to select your answer(s).

Explanation / Answer

a) Within one standard deviation:

$(1280 - 80) to $(1280 + 80)

$ 1200 to $ 1360

b) Within two standard deviation:

$(1280 - 2*80) to $(1280 + 2*80)

$ 1120 to $ 1440

c) Within three standard deviation:

$(1280 - 3*80) to $(1280 + 3*80)

$ 1040 to $ 1520

d) Option A is correct.

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