# Significance Level and Improvement in Tread Design

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A company that produces bias-ply tires is considering a certain modification in the tread design. An economic feasibility study indicates that the modification can be justified only if true average tire life under standard test conditions exceeds 20,000 miles. A random sample of n = 16 prototype tires is manufactured and tested, resulting in a sample average tire life of Suppose tire life is normally distributed with  = 1500 (the value for the current version of the tire). Does this data suggest that the modification meets the condition required for changeover? Test the appropriate hypothesis (state it!) using significance level 0.01.

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##### Solution Summary

A company that produces bias-ply tires is considering a certain modification in the tread design. An economic feasibility study indicates that the modification can be justified only if true average tire life under standard test conditions exceeds 20,000 miles. A random sample of n = 16 prototype tires is manufactured and tested, resulting in a sample average tire life of Suppose tire life is normally distributed with  = 1500 (the value for the current version of the tire). Does this data suggest that the modification meets the condition required for changeover? Test the appropriate hypothesis (state it!) using significance level 0.01.

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