Determine the average insurance claim

Assignment Help Business Management
Reference no: EM132919978

An insurance company is reviewing its current policy rates. Originally the average claim amount was $2 100. Suppose a researcher believes that the mean claim is now lower. The researcher randomly selects 70 claims and calculates the sample mean to be $1950. Assume that the population standard deviation of all claims is $400.

At a 1% level of significance, carry out an appropriate hypothesis test to determine whether the average insurance claim is now lower than $2 100. Assume the claim amounts are normally distributed

(i) Write the null hypothesis and alternative hypothesis, the type and direction of the test.

(ii) Find the critical value and write the decision rule.

Reference no: EM132919978

Questions Cloud

List five of the analytical platforms : List five of the analytical platforms. Discuss any of 3 in details. List and Discuss different types of users in future analytical architectures.
Provide journal entries to account for the revaluation : An item of depreciable machinery is acquired on 1 July. Discuss when do you think should a revaluation increment be included as part of profit or loss?
What the purchase of the new equipment : The new equipment costs the company P900,000. The company uses 16% cost of capital. What the purchase of the new equipment will result to net present value
What the company return on total assets for the year : Brachlan Company's net income last year was $80,000 and its interest expense was $20,000. What the company return on total assets for the year
Determine the average insurance claim : An insurance company is reviewing its current policy rates. Originally the average claim amount was $2 100. Suppose a researcher believes that the mean claim is
Determine the size of the quarterly coupon payments : Determine the size of the quarterly coupon payments if the accrued bond interest from February 6, 2019 to March 23, 2019 is $5.14
What is the present value of this coupon bond : Suppose the yield to maturity (that is, the discount rate) for the bond is 10%, what is the present value of this coupon bond? Is it a discount bond
Compute the current price of the shares : The required return on common shares (Ke) is 16 percent. The firm has a constant growth rate (g) of 6 percent. Compute the current price of the shares
Calculate the maximum profits the firm makes : A firm's demand curve in period 1 is Q=25 - P. Fixed costs are 20 and marginal costs per unit are 5.

Reviews

Write a Review

Business Management Questions & Answers

  Opening statement as the employer for arbitration

How do you outline an opening statement as the employer for arbitration?

  What is the financial implications reverse logistics

What is the financial implications reverse logistics has on a retailer's bottom line. Please provide an example.

  Tackling the talent war in the health sector

What are the variables that influence an employee's decision to leave or stay at an organization? (Hint: It's not just money.)

  How do they use visuals to keep attention

Locate two annual reports on the Internet. A good source is Report Watch. Compare the style of the two reports. Here are some questions to get you started: 1. How do they use visuals to keep attention?

  How to do data analysis for research questionnaire

I just want to know if you know how to do data analysis for research questionnaire? The creativity and innovation can be a source of competitive advantage.

  Explain international monetary fund tax benefit for business

Describe its origin, organization, purpose, and tax benefits for new business. Format your assignment consistent with APA guidelines.

  Correlation and regression analysis using sun coast data set

Correlation and Regression Analysis Using Sun Coast Data Set, Using the Sun Coast data set, perform a correlation analysis, simple regression analysis,

  Please help me answer these questions

Does your school, work, or organizational affilate managed by stockholder or stakeholer appraoach? Is this appropriate?

  Illustrate what will be the book value of this purchase

Illustrate what will be the book value of this purchase (excluding all other Plant and Equipment) after its first year of use?

  Preparation of financial reports

How can employee be engaged in the preparation of financial reports, allowing details to be easily disseminated among team members

  Effectiveness with respect to certain areas

1. Describe specific qualitative methods and tools that could be used within your discipline to gather data. Include your rationale. 2. Evaluate their effectiveness with respect to certain areas within your discipline. 3. Include company or organiz..

  Explain ravi behavior in terms of sources of power

(a) Explain Ravi's behavior in terms of sources of power. (b) Suggest what the management can do to change the behavior of Ravi's and other workers like him.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd