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Res 342 Week 3 Etext

In: Business and Management

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Week 3 E-Text
Chauntilena Goodwin
RES/342
May 1, 2012
Olivia Scott

Week 3 E-Text
10.30 In Dallas, some fire trucks were painted yellow (instead of red) to heighten their visibility. During a test period, the fleet of red fire trucks made 153,348 runs and had 20 accidents, while the fleet of yellow fire trucks made 135,035 runs and had 4 accidents. At α = .01, did the yellow fire trucks have a significantly lower accident rate? (a) State the hypotheses. H0: p1 ≥ p2 H1: p1 < p2 (b) State the decision rule and sketch it. Reject the null hypothesis if the critical value is less than z.010= -2.326 and the p-value is greater than .01.

(c) Find the sample proportions and z test statistic. P1 = 4135,035 = .00002962 p2 = 20153,348 = .00013042 P = x1+ x2n1+ n2 = 4+20135,035+153,348 = .00008322 z.010 = P1-P2p1-P[1n1+1n2] = .00002962-.00013042.000083221-.0000832[1135,035+1153,348] = -2.9610

(d) Make a decision. Since the z.010 < -2.326 the decision is to reject the null hypothesis (e) Find the p-value and interpret it. P (z<-2.9610) = .0015. The probabilities of a z-score lower than -2.9610 is only .0015. (f ) If statistically significant, do you think the difference is large enough to be important? If so, to whom, and why? The difference of statistical significant is important so that the fire department can have information that can lower cost and make operation safer. (g) Is the normality assumption fulfilled? Explain. The sample size is large enough to assure that normality assumption is valid. 10.44 Does lovastatin (a cholesterol-lowering drug) reduce the risk of heart attack? In a Texas study, researchers gave lovastatin to 2,325 people and an inactive substitute to 2,081 people (average age 58). After 5 years, 57 of the lovastatin group had suffered a heart attack, compared with 97 for the inactive pill. (a)...

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