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Hypothesis Test

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A leasing firm claims that the mean number of miles driven annually, u, in its leased cars is less than 13,340 miles. A random sample of 13,239 cars leased from this firm had a mean of annual miles driven. It is known that the population standard deviation of the number of miles driven in cars from this firm is 1680 miles. Assume that the population is normally distributed. Is there support for the firm's claim at the 0.1 level of significance?

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The solution provides a step-by-step method for performing a one-tailed hypothesis test. All the steps of hypothesis testing (formulation of null and alternative hypotheses, selection of significance level, choosing the appropriate test-statistic, decision rule, calculation of test-statistic and conclusion) have been explained and the statistical analysis has been shown in details.

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Solution:
Null Hypothesis: The mean number of miles driven annually in its leased cars is greater than or equal to13340 miles.
H0: μ≥13340

Alternate Hypothesis: The mean number of miles driven annually in its leased cars is less than 13340 ...

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