A PBS report was done on a study which looked if doctors who received free sampl

Question

A PBS report was done on a study which looked if doctors who received free samples were more likely to prescribe more expensive drug treatments. It was reported that the average cost of a first visit for acne or rosacea was over $450 for medication for the physicians that use samples compared to a clinic where we there are no samples and the average cost was only 200-hundred dollars. Suppose the number of physicians surveyed was 8 and the variance was $100 dollars. Is the difference statistically significant?

Explanation / Answer

Data:    

n = 8   

= 450   

s = 10   

x-bar = 200   

Hypotheses:    

Ho: 450   

Ha: > 450   

Decision Rule:    

= 0.05   

Degrees of freedom = 8 - 1 = 7

Critical t- score = 1.894578604   

Reject Ho if t > 1.894578604   

Test Statistic:    

SE = s/n = 10/8 = 3.535533906

t = (x-bar - )/SE = (200 - 450)/3.53553390593274 = -70.7106781

Decision (in terms of the hypotheses):    

Since -70.71067812 < 1.894578604 we fail to reject Ho

Conclusion (in terms of the problem):    

There is no sufficient evidence that the mean is greater than $450.    

Related Questions

Navigate

• Browse (All)
• Browse A
• Subjects

---

---

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