Explaining hypotheses and decision rule

Reference no: EM1312052

Q1) Auditor reviewed 25 oral surgery insurance claims from particular surgical office, finding \ the mean out-of-pocket patient billing above \ reimbursed amount was $275.66 with the standard deviation of $78.11.

(a) At 5% level of significance, does this sample prove violation of guideline that average patient must pay no more than $250 out-of-pocket? Write your hypotheses and decision rule.

(b) Is this a close decision?

Hypotheses:	H0: _ = 250 vs. _ > 250
Level of Significance:	5%
Decision Rule	Reject the null hypothesis if p-value < 0.05
Calculation:	Hypothesis Test: Mean vs. Hypothesized Value
Hypothesized value	250.0000
Mean Sample	275.6600
std. dev.	78.1100
std. error	15.6220
n	25
df	24
t	1.64
p-value (one-tailed, upper)	.0568

Reference no: EM1312052

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