Question

Therefore, McFarland has instituted cost-cutting measures in an attempt to reduce
this cost and a sample of 15 claims from the prior month were randomly selected
to determine if these new measures have indeed caused a reduction in process
claim costs.
At a 95.00% confidence level, is it reasonable to conclude that the MEAN.P to process
a claim is now less than $60?
45
49
62
40
43
61
48
53
67
63
78
64
48
54
51

Answer 1

From the given sample data : n=15 , ,

The sample mean is ,

The sample standard deviation is ,

The null and alternative hypothesis is ,

Now , df=degrees of freedom=n-1=15-1=14

The critical value is ,

; From t-table

The test stattistic is ,

Decision : Here , the value of the test statistic lies in teh rejection region.

Therefore , reject the null hypothesis.

Conclusion : Hence , it is reasonable to conclude that the MEAN.P to processa claim is now less than $60.