HI6007 Statistics For Business Decisions - Tutorial Questions

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Question 3 (11 marks)

D Dax limited installed a new safety equipment in order to reduce the number of person hours lost as a result of industrial accident. In a test to of the effectiveness of the equipment, a random sample of 50 departments was chosen. The number of person- hours lost in the month prior to and the month after the installation of the safety equipment was recorded. The percentage change was calculated and recorded. Assume that the population standard deviation is 5 and sample mean is -1.2. Can we infer at the 10% significance level that the new safety equipment is effective?
You are required to
a. Formulate hypotheses (3 marks)
b. Decide the suitable test statistics and justify your selection. (1 mark)
c. Calculate the value of the relevant test statistics and identify the P value (3 marks)
d. Based on the test statistics in part (III), decide the decision criteria. (2 marks)
e. Make the final conclusion based on the analysis. (2 marks)

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