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Z test for proportion of accident rate of fire trucks

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In Dallas, some fire trucks were painted yellow (instead of red) to heighten their visibility. During a test period, the fleet of red fire trucks made 153,348 runs and had 20 accidents, while the fleet of yellow fire trucks made 135,035 runs and had 4 accidents. At á = .01, did the yellow fire trucks have a significantly lower accident rate?

(a) State the hypotheses.

(b) State the decision rule and sketch it.

(c) Find the sample proportions and z test statistic.

(d) Make a decision.

(e) Find the p-value and interpret it.

(f) If statistically significant, do you think the difference is large enough to be important? If so, to whom, and why?

(g) Is the normality assumption fulfilled? Explain.

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Solution Summary

The solution provides step by step method for the calculation of Z test for proportion of accident rate of fire trucks . Formula for the calculation and Interpretations of the results are also included. This problem is from the e-text, Applied Statistics in Business and Economics, by Doane and Seward