Question

A leasing firm claims that the mean number of miles driven annually,

μ, in its leased cars is less than 12580 miles. A random sample of 50 cars leased from this firm had a mean of 12291 annual miles driven. It is known that the population standard deviation of the number of miles driven in cars from this firm is

1740 miles. Is there support for the firm's claim at the 0.01 level of significance?

Perform a one-tailed test. Then fill in the table below.

Carry your intermediate computations to at least three decimal places, and round your responses as specified in the table.

The null hypothesis:	H0:
The alternative hypothesis:	H1:
The type of test statistic:	(Choose one)ZtChi squareF
The value of the test statistic: (Round to at least three decimal places.)
The critical value at the 0.01 level of significance: (Round to at least three decimal places.)
Can we support the leasing firm's claim that the mean number of miles driven annually is less than 12580 miles?		Yes	No

Answer 1

From the given information,

By using calculator,

The required correct answers are given in the table as,

The null hypothesis:	H0: μ = 12580
The alternative hypothesis:	H1: μ < 12580
The type of test statistic:	Z
The value of the test statistic: (Round to at least three decimal places.)	-1.174
The critical value at the 0.01 level of significance: (Round to at least three decimal places.)	-2.326
Can we support the leasing firm's claim that the mean number of miles driven annually is less than 12580 miles?		No

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