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    One step tests of hypothesis

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    An insurance company, based on past experience, estimates the mean damage for a natural disaster in its area is $5,000. After introducing several plans to prevent loss, it randomly samples 200 policy holders and finds the mean amount per claim was $4,800 with a standard deviation of $1,300, Does it appears the prevention plans were effective in reducing the mean amount of a claim? Use the significance level.

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    https://brainmass.com/statistics/hypothesis-testing/one-step-tests-hypothesis-241194

    Solution Preview

    Hypothesis:
    Null Hypothesis:
    H0:µ=5000
    Alternative Hypothesis:
    H1:µ≠5000
    Level of significance α ...

    Solution Summary

    The solution examines one step tests for hypothesis The solution determines if the prevention plans were effective in reducing the mean amount of claim.

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