Question

You compare monthly car insurance rates for two sister cities. You collect data and come up with the following:

You decided to test whether the monthly car insurance rates are different between the sister cities. Assume that both underlying population distributions are normal.

a) Should you use the pooled or non-pooled t - test? Explain.

	City A	City B
Sample Mean	$105	$125
Sample Standard Deviation	$20	$9
Sample Size	14	12

b) Test at the 5% level of significance whether the mean monthly car insurance rates are different be- tween the two sister cities. If needed, use the conservative method for the degrees of freedom.

Answer 1