1

BatCo (The Battery Company) produces your typical consumer battery.

The
company claims that their batteries last at least 100 hours, on average. Your
experience with the BatCo battery has been somewhat different, so you decide to
conduct a test to see if the companies claim is true. You believe that the mean life is
actually less than the 100 hours BatCo claims. You decide to collect data on the
average battery life (in hours) of a random sample and the information related to the
hypothesis test is presented below.

Test of
alternative

100

versus

one-tailed

Hypothesized mean

100.0

Sample mean

98.5

Std error of mean

0.777

Degrees of freedom
t-test statistic
p-value

19
-1.932
0.034

a. Can the sample size be determined from the information above? Yes or no? If yes,
what is the sample size in this case?
b. You believe that the mean life is actually less than 100 hours, should you conduct a
one-tailed or a two-tailed hypothesis test? Explain your answer.
c. What is the sample mean of this data? If you use a 5% significance level, would you
conclude that the mean life of the batteries is typically more than 100 hours?
Explain your answer.
d. If you were to use a 1% significance level in this case, would you conclude that the
mean life of the batteries is typically more than 100 hours? Explain your answer.

2. Dera City Center is interested in comparing its male and female customers.
City Center would like to know if its female customers spend more money, on
average, than its male charge customers. They have collected random samples of
25 female customers and 22 male customers.
On average, women charge
customers spend $102.23 and men charge customers spend $86.46. Additional
information are shown below:
Summary statistics for two samples
Sales (Female)

Sales (Male)

Sample sizes

25

22

Sample means

102.23

86.460

standard 93.393

59.695

Sample
deviations

Test of difference=0
Sample mean difference
Pooled standard deviation
Std error of difference

15.77

t-test statistic

79.466

p-value

23.23

H0

Ha

a) Given the information above, what is

and
for this comparison? Also, does
this represent a one-tailed or a two-tailed test? Explain your answer.

H0
Null Hypothesis

Ha
Alternative Hypothesis

b) What are the degrees of freedom for the t-statistic in this calculation? Explain how
you would calculate the degrees of freedom in this case.
c) Using a 10% level of significance, is there sufficient evidence for City Center to
conclude that women charge customers on average spend more than men charge
customers? Explain your answer.

d) Using a 1% level of significance, is there sufficient evidence for City Center to

conclude that women charge customers on average spend more than men charge
customers? Explain your answer.
3.A producer of steel cables wants to know whether the steel cables it produces have an
average tensile strength of more than 1000 pounds. Hoping to find support for this
claim, the firm collects a random sample of 100 cables and records the tensile strength
(In pounds) of each.
The sample data are contained in the Cabel.xls
a) One tailed test or two tailed test
b) Null hypothesis & Alternative hypothesis.
c) Using a 5% significance level, can this cable manufacturer claim that its cable
typically has tensile strength more than 1000 pounds? Explain your answer.
d) Using a 1% significance level, can this cable wire manufacturer claim that its wire
typically last more than 1000 pounds? Explain your answer.
4. A study is performed in southern town Dubai to determine whether the average
weekly grocery bill per four person family in the town is significantly different from the
national average. Assume that the national average weekly grocery bill for a four person
family is $ 100.
A random sample of the weekly grocery bill of four person families in this town is given
in Grocery.xls.
a)
b)
c)
d)

One tailed test or two tailed test

Null hypothesis:
Alternative hypothesis:
Assume that the national average weekly grocery bill for a four person family is $
100. Is the sample evidence statistically significant? If so, at what significance level
can you reject the null hypothesis?
e) For which value of sample mean (i.e., weekly grocery bill) would you decide to reject
the null hypothesis at the alpha=.01 significance level? For which values of the
sample mean would you decide to reject the null hypothesis at the alpha=0.10
level?

5. The manager of Papa John's Restaurant at food court academic city has recently
begun experimenting with a new method of baking its pizzas. He believes that the new
method produces a better-tasting pizza, but he would like to base a decision on whether
to switch from the old method to the new method on customer reactions.
Therefore he performs an experiment. For 100 randomly selected customers who order
a Papa John's pizza for home delivery, he includes both an old style and a free new style
pizza in the order.

All he asks is that these customers rate the difference between pizzas on a -10 to +10
scale, where -10 means they strongly favor the old style, +10 means they strongly favor
the new style, and 0 means they are indifferent between the two styles.
a) Test whether consumer prefer the new style pizza to the old style.
b) Revise the rating by multiplying each rating by -1, and run the test again.

6. The Al wasal Company manufactures high-quality treadmills for use in exercise clubs.
Al wasal currently purchases its motors for these treadmills from supplier A. However, it
is considering a change to supplier B, which offers a slightly lower cost. The only
question is whether supplier Bs motors are as reliable as supplier As. To check this Al
wasal installs motors from supplier A on 30 of its treadmills and motors from supplier B
on another 30 of its treadmills. It then runs these treadmills under typical conditions
and, for each treadmill, records the number of hours until the motor fails. What can Al
wasal conclude?
7. A large required Business statistics course at City University has been using the same
textbook for a number of years. Over the years, the students have been asked to rate
this textbook on a 1 to 10 scale, and the average rating has been stable at about 5.2.
This year, faculty decided to experiment with a new textbook. After the course, 50
randomly selected students were asked to rate this new textbook. Can we conclude
that the students like this new textbook any more than the previous textbook?

8. Sports: A sport preference poll yielded the following data for men and women. Use
the 5% significance level and test to determine is sport preference and gender are
independent.

Sport Preference
Basketball Football

Soccer

20

25

30

75

Women 18

12

15

45

38

37

45

120

Men
Gender

H0
a) Given the information above, what is

Ha
and

for this comparison.

b) Fill

the below
table:

Expected
counts

mentioned

Distances of observed from

expected

Chi-square
statistic

c)

test

If you were to use a 5% significance level, what would be your conclusion?

your answer.

Explain

9.A recent study of educational levels of 1000 voters and their affiliations to Stock
Market, Forex Market and Commodity Market in a Singapore showed the results given in
the table below. Use the 5% significance level and test to determine if affiliation is
independent of the educational level of the voters.

Market Affiliation
Stock
Commodit
Mkt
Forex Mkt y Mkt

Educational
Level

95

80

115

290

Post Graduates

135

85

105

325

Professional
Qualification

160

105

120

385

390

270

340

1000

Graduates

H0
d) Given the information above, what is

e) Fill

Ha
and

the below
table:

Expected
counts

Distances of observed from

expected

Chi-square
statistic

for this comparison.

test

mentioned

f)

If you were to use a 5% significance level, what would be your conclusion?

your answer.

Explain

10. A tire manufacturing company invents a new, cheaper method for carrying out one
of the steps in the manufacturing process. The company wants to test the new method
before adopting it, because the method could alter the interply shear strength of the
tires produced.
To test the acceptability of the new method, the company formulates the null and
alternative
a. Assuming that the two populations are normally distributed with equal variance, test
the null hypothesis that the two companies average charges are equal.
b. Test the assumption of equal variance.
c. Assuming unequal variance, test the null hypothesis that the two companies average
charges are equal.
The evidence is gathered through a destructive test of 40 randomly selected tires from
each method. Following are the data gathered:
Data sheet enclosed:
1. Test the null hypothesis at =0.05.
2. Later it was found that quite a few tires failed on the road. As a part of the
investigation, the above hypothesis test is reviewed. Considering the high cost of type II
error, the value of 5% for is questioned. The response was that the cost of type I error
is also high because the new method could save millions of dollars. What value for
would you say is appropriate?
Will the null hypothesis be rejected at that ?
3. A review of the tests conducted on the samples reveals that 40 otherwise identical
pairs of tires were randomly selected and used. The two tires in each pair underwent the
two different methods, and all other steps in the manufacturing process were identically

carried out on the two tires. By virtue of this fact, it is argued that a paired difference
test is more appropriate.
Conduct a paired difference test at = 0.05.
2

The manufacturer moves to reduce the variance of the strength by improving the
process. Will the reduction in the variance of the process increase or decrease the
chances of type I and type II errors?

11. If you need to classify these scanners into two groups, how can you
categories
them/
Are
there
any
interactions
among
the
scanners. Statistically validate your opinion.
Three checkout lines at a supermarket use three different scanner systems
that read the UPC symbols on products and find the prices. The store
manager suspects that the three scanner systems have different efficiencies
and wants to check their speeds. He measures at randomly selected times
the speed of each system in number of items scanned per minute. The
measurements are given in the table below. Assume normal distribution with
equal variance for the three systems.
Conduct a one-way ANOVA to test the null hypothesis that all three scanner
systems have the same average number scanned per minute. Use of 0.05.
12. After studying the test results, a representative of the manufacturer of
one of the three scanner systems remarks that the ANOVA results may be
affected by the differing skills of the checkout clerks. The clerks were not the
same for all measurements. Wanting to know the difference in the efficiencies
of the clerks as well as the systems, the manager redesigns the experiment
to yield measurements for all combinations of five clerks and three systems.
The measurements from this experiment are tabulated below. Assume normal
distribution with equal variance for all cells.
13. Gulfstream Aerospace Company produced three different prototypes
as candidates for mass production as the companys newest large-cabin
business jet, the Gulfstream IV. Each of the three prototypes has slightly
different features, which may bring about differences in performance.
Therefore, as part of the decision-making process concerning which model to
produce, company engineers are interested in determining whether the three
proposed models have about the same average flight range. Each of the
models is assigned a random choice of 10 flight routes and departure times,
and the flight range on a full standard fuel tank is measured (the planes carry
additional fuel on the test flights, to allow them to land safely at certain
destination points). Range data for the three prototypes, in nautical miles
(measured to the nearest 10 miles), are as follows.5

Do all three prototypes have the same average range? Give your hypothesis,
construct an ANOVA table, and carry out the test. Explain your results use a
of 0.05 to report your conclusion
Which pair of prototypes has a significant difference in their average
performance? Why?