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Quiz3-sec2-Questions&Solutions - Name-Surname...

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1 Name-Surname: Student ID: MIDDLE EAST TECHNICAL UNIVERSITY NORTHERN CYPRUS CAMPUS SPRING 2011 BUS 152 Statistics for Social Sciences Quiz 3 Section 2 Solutions Q1. An insurance company’s Claims Department reports the mean cost to process a claim is $25. An industry comparison showed this amount to be larger than most other insurance companies, so the company instituted cost-cutting measures. To evaluate the effect of cost- cutting measures, the supervisor of the Claims Department selected a random sample of 36 claims processed last month, and the results are as follows: 25 25 26 23 24 21 20 21 25 24 25 22 19 26 27 21 27 26 21 25 25 22 29 22 25 26 22 24 21 28 27 20 25 22 19 20 The company wonders if there is evidence that the mean cost to process a claim is less than $25 at the 0.01 significance level. a) State the null and alternative hypothesis. H 0 : H 1 : b) Given the following SPSS output, is there evidence that the mean cost to process a claim is less than $25 at the 0.01 significance level? Why?
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