One of the Major U

question 130

Multiple Choice

One of the major U.S. tire makers wishes to review its warranty for their rainmaker tire. The warranty
Is for 40,000 miles. The tire company believes that the tire actually lasts more than 40,000 miles
With a standard deviation of 15,000 miles. A sample 49 tires revealed that the mean number of
Miles is 45,000 miles. Test the hypothesis with a 0.05 significance level.

• A) At a 5% level of significance, our decision is to reject the null hypothesis. The tires last more than 40 000 miles.
• B) At a 5% level of significance, our decision is to accept the null hypothesis. The tires last 40,000 miles.
• C) At a 5% level of significance, we should have used the t-test, rather than the z-test.