According to a leasing firm's reports, the mean number of miles driven annually in its leased cars is 12,880 miles with a standard deviation of 2640 miles. The company recently starting using new contracts which require customers to have the cars serviced at their own expense. The company's owner believes the mea number of miles driven annually under the new contracts, μ, is less than 12,880 miles. He takes a random sample of 90 cars under the new contracts. The cars in the sample had a mean of 12,107 annual miles driven. Is there support for the claim, at the 0.01 level of significance, that the population mean number of miles driven annually by cars under the new contracts, is less than 12,880 miles? Assume that the population standard deviation of miles driven annually was not affected by the change to the contracts. Perform a one-tailed test. Then complete the parts below. Carry your intermediate computations to three or more decimal places, and round your responses as specified below. (If necessary, consult a list of formulas.) (a) State the null hypothesis H. and the alternative hypothesis H₁. H:0 (b) Determine the type of test statistic to use. (Choose one) ▼ (c) Find the value of the test statistic. (Round to three or more decimal places.) (d) Find the p-value. (Round to three or more decimal places.) (e) Can we support the claim that the population mean number of miles driven annually by cars under the new contracts is less than 12,880 miles? O Yes O No I X 5 O X S 2 00 < Р =O OSO 020 S ô olo >

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**Statistical Hypothesis Testing on Mean Mileage**

According to a leasing firm's reports, the mean number of miles driven annually in its leased cars is 12,880 miles with a standard deviation of 2,640 miles. The company is implementing new contracts requiring customers to pay for their own car services. The company owner suspects the mean annual mileage under the new contracts—denoted as μ—is less than 12,880 miles. A sample of 90 cars under the new contracts showed a mean of 12,107 annual miles driven. To test the claim that, at the 0.01 significance level, the population mean number of miles driven annually under the new contracts is less than 12,880 miles, and assuming the population standard deviation remains the same, we perform a one-tailed test.

**Steps to Analyze the Claim:**

(a) **State the Hypotheses:**

- Null Hypothesis \( H_0 \): \( \mu = 12,880 \)
- Alternative Hypothesis \( H_1 \): \( \mu < 12,880 \)

(b) **Determine the Test Statistic:**

Choose the appropriate test statistic based on the sample size and known population data. Use a Z-test given the sample size is large (n=90) and the population standard deviation is known.

(c) **Calculate the Test Statistic:**

- Using the formula for the Z-test statistic:
  \[
  Z = \frac{\bar{X} - \mu}{\sigma / \sqrt{n}}
  \]
  Where:
  - \(\bar{X} = 12,107\)
  - \(\mu = 12,880\)
  - \(\sigma = 2,640\)
  - \(n = 90\)

(d) **Find the p-value:**

Calculate the p-value corresponding to the Z-test statistic.

(e) **Decision:**

Based on the p-value and the significance level (0.01), determine if there is enough evidence to support the claim that the mean annual mileage is less than 12,880 miles. Choose "Yes" or "No."

**Graphical Elements:**

The image includes a table for entering hypothesis statements, selecting the type of test, and input fields for test statistic, p-value, and decision-making. A calculator interface is also shown for entering various statistical symbols and formulas.
Transcribed Image Text:**Statistical Hypothesis Testing on Mean Mileage** According to a leasing firm's reports, the mean number of miles driven annually in its leased cars is 12,880 miles with a standard deviation of 2,640 miles. The company is implementing new contracts requiring customers to pay for their own car services. The company owner suspects the mean annual mileage under the new contracts—denoted as μ—is less than 12,880 miles. A sample of 90 cars under the new contracts showed a mean of 12,107 annual miles driven. To test the claim that, at the 0.01 significance level, the population mean number of miles driven annually under the new contracts is less than 12,880 miles, and assuming the population standard deviation remains the same, we perform a one-tailed test. **Steps to Analyze the Claim:** (a) **State the Hypotheses:** - Null Hypothesis \( H_0 \): \( \mu = 12,880 \) - Alternative Hypothesis \( H_1 \): \( \mu < 12,880 \) (b) **Determine the Test Statistic:** Choose the appropriate test statistic based on the sample size and known population data. Use a Z-test given the sample size is large (n=90) and the population standard deviation is known. (c) **Calculate the Test Statistic:** - Using the formula for the Z-test statistic: \[ Z = \frac{\bar{X} - \mu}{\sigma / \sqrt{n}} \] Where: - \(\bar{X} = 12,107\) - \(\mu = 12,880\) - \(\sigma = 2,640\) - \(n = 90\) (d) **Find the p-value:** Calculate the p-value corresponding to the Z-test statistic. (e) **Decision:** Based on the p-value and the significance level (0.01), determine if there is enough evidence to support the claim that the mean annual mileage is less than 12,880 miles. Choose "Yes" or "No." **Graphical Elements:** The image includes a table for entering hypothesis statements, selecting the type of test, and input fields for test statistic, p-value, and decision-making. A calculator interface is also shown for entering various statistical symbols and formulas.
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