lifetime is normally distributed with a standard deviation
Now the claim is that the manufacturing process has raised the average lifetime from 30000 miles
Hence the hypothesis formed are
. This is a right-tailed test
We will fail to reject the null (commit a Type II error) if we get a Z statistic less than A.
This 'A' Z-critical value corresponds to some X critical value ( X critical), such that
.......................(1)
So I will incorrectly fail to reject the null as long as a draw
a sample mean that less than
. To complete the problem what I now need to do is compute the
probability of drawing a sample mean less than given
for Power of
the Hypothesis test is 0.2
The probability of type II error is 1-0.2=0.8
.....................(2)
Evaluating (1) and (2)
..........................................(3)
for Power of
the Hypothesis test is 0.85176
The probability of type II error is 1-0.85176=0.14824
.....................(4)
Evaluating (1) and (4)
..........................................(5)
Now solving (3) and (5)
The sample size n = 8 and the significance level is
5. (This problem is inspired by one of my best students, who went on to get...
Estimate purchases in 1996. (Hint: Cost of goods equals
purchases plus beginning inventory minus ending
inventory.)
Use the percent of sales method to estimate funds needed
in 1996 using the 1995 percentages.
CASE 1 2 TOPEKA ADHESIVES (1) FINANCIAL FORECASTING Karen and Elizabeth Whatley are twins. Their mother teaches Physics at a mid- western university and their father runs a successful engineering firm. Not sur- prisingly, they are quite gifted at math and science, and they've displayed these talents in...