The president of theAmerican Insurance Institute wants to compare the yearly costs ofauto insurance offered by two leading companies. He selects asample of 15 families, some with only a single insured driver,others with several teenage drivers, and pays each family a stipendto contact the two companies and ask for a price quote. To make thedata comparable, certain features, such as the deductible amountand limits of liability, are standardized. The data for the sampleof families and their two insurance quotes are reported below.
At the 0.10significance level, can we conclude that there is a difference inthe amounts quoted? Hint: For the calculations, assume the\"Midstates Car Insurance\" as the first sample.
| Midstates Car | | Gecko Mutual |
Family | Insurance | | Insurance |
Becker | $ | 2,090 | | | $ | 1,610 | |
Berry | | 1,683 | | | | 1,247 | |
Cobb | | 1,402 | | | | 2,327 | |
Debuck | | 1,830 | | | | 1,367 | |
DuBrul | | 930 | | | | 1,461 | |
Eckroate | | 697 | | | | 1,789 | |
German | | 1,741 | | | | 1,621 | |
Glasson | | 1,129 | | | | 1,914 | |
King | | 1,018 | | | | 1,956 | |
Kucic | | 1,881 | | | | 1,772 | |
Meredith | | 1,571 | | | | 1,375 | |
Obeid | | 874 | | | | 1,527 | |
Price | | 1,579 | | | | 1,767 | |
Phillips | | 1,577 | | | | 1,636 | |
Tresize | | 860 | | | | 1,188 | |
1. State the decisionrule for 0.10 significance level: H0:μd = 0 H1:μd ≠0. (Negative valuesshould be indicated by a minus sign. Round your answers to 3decimal places.)
Reject H0 if T<_______ or t> _________
2. Compute the teststatistic. (Negative value should be indicated by a minussign. Round your answer to 2 decimal places.)
The test statistic is___________
3. State your decisionabout the null hypothesis.
- Do not reject H0
- Reject H0