A leasing firm claims that the mean number of miles driven annually, , in its le

Question

A leasing firm claims that the mean number of miles driven annually, , in its leased cars is less than 13160 miles. A random sample of 50 cars leased from this firm had a mean of 12899 annual miles driven. It is known that the population standard deviation of the number of miles driven in cars from this firm is 2660 miles. Assume that the population is normally distributed. Is there support for the firm's claim at the 0.05 level of significance?

Perform a one tailed test. Then fill in the table below.

Carry your intermediate computations to at least three decimal places, and round your responses as specified in the table. (If necessary, consult a list of formulas.)

1. The null hypothesis: H0 :

2. The alternative hypothesis: H1 :

3. The type of test statistic: (Choose one) Z or t or Chi Square or F

4. The value of the test statistic: (Round to at least three decimal places.)

5. The p value: (Round to at least three decimal places.)

6. Can we support the leasing firm's claim that the mean number of miles driven annually is less than 13160 miles? (Yes/No)

Explanation / Answer

1)null hypothesis: H0 :mean =13160

2)alternate hypothesis: HA : mean<13160

3)as sample size >30 we use z stat also population SD is known

4)std error = std deviation/(n)1/2 =376.18

test stat z=(X-mean)/std error =-0.6938

5)The p value: =0.2439

6)No as p value is higher we can not reject null hypothesis

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