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Hypothesis testing

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42. The president of the American Insurance Institute wants to compare the yearly costs of auto
insurance offered by two leading companies. He selects a sample of 15 families, some with
only a single insured driver, others with several teenage drivers, and pays each family a
stipend to contact the two companies and ask for a price quote. To make the data comparable,
certain features, such as the amount deductible and limits of liability, are standardized.
The sample information is reported below. At the .10 significance level, can we
conclude that there is a difference in the amounts quoted?


Solution Summary

This provides three examples of completing hypothesis testing questions for a given significance level.