OPMT 600 Application Assignment 4.docx - OPMT 600...

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OPMT 600 – Statistical Methods for Decision MakingDavid Naughtin & Michael GaytkoApplication Assignment #4 – Hypothesis testing with 1 and 2 sample meansDue November 9thNote:Data sets are available in Canvas. All computations should be done by the computer.Show appropriate graphical analyses as well as appropriate statistical analyses. All answers and comments should be typed directly into this Worddocument. Carefully consider the null hypothesis and alternative hypotheses for each question. 1. With an automobile moving 30 mph, the mean stopping distance has been 65’. new brake system has been developed and the VP wants to determine if the new system is more effective than the old (i.e. car stops sooner). A sample of 64 observations was taken and the sample mean stopping distance is 63.5’. Assume sigma is known and the same as the old braking system at 4’. a.Set up null and alternative hypothesis. Explain the null and alternate hypothesis in this business application.A
b.Test at the .01 level. What is your conclusion?
Z P
0.001
c.For this situation, identify the Type I and Type II errors and the potential issues associated with making each type of error. From a business perspective, which error is worse? What about from the consumer perspective?

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