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Hypothesis Testing for Mean-Local Tire Store

Hypothesis Testing for Mean (Small Samples)

1. A local tire store suspects that the mean life of a new discount tire is less that 39,000 miles. To check the claim, the store selects randomly 18 of these new discount tires. When they are tested, it is found that the mean life is 38,250 miles with a sample standard deviation s = 1200 miles.

a. Use the critical value z0 method from the normal distribution to test for the population mean . Test the company's claim at the level of significance  = 0.05.

1. H0 :
Ha :
2.  =
3. Test statistics:
4. P-value or critical z0 or t0.
5. Rejection Region:
6. Decision:

7. Interpretation:

b. Use the critical value z0 method from the normal distribution to test for the population mean . Test the company's claim at the level of significance  = 0.01

1. H0 :
Ha :
2.  =
3. Test statistics:
4. P-value or critical z0 or t0.
5. Rejection Region:
6. Decision:
7. Interpretation:

See attached:

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Hypothesis Testing for Mean (Small Samples)

1. A local tire store suspects that the mean life of a new discount tire is less that 39,000 miles. To check the claim, the store selects randomly 18 of these new discount tires. When they are tested, it is found that the mean life is 38,250 miles with a sample standard deviation s = 1200 miles.

a. Use the critical value z0 method from the normal distribution to test for the population mean . Test the company's claim at the level of significance  = 0.05.

Answer

Since the sample size is small and the population standard deviation is unknown, we use t test.

1. H0 : The mean life of new discount tire ≥ 39,000 miles
Ha : The mean life of new discount tire < 39,000 ...

Solution Summary

The solution provides step by step method for the calculation of testing of hypothesis . Formula for the calculation and Interpretations of the results are also included. Interactive excel sheet is included. The user can edit the inputs and obtain the complete results for a new set of data.

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