The Service Manager of a Car Dealer Wants to Determine

question 51

Essay

The service manager of a car dealer wants to determine if owners of new cars (two years old or less)tune up their cars more frequently than owners of older cars (more than two years old).From his records he takes a random sample of ten new cars and ten older cars and determines the number of times the cars were tuned up in the last 12 months.The data follow.Do these data allow the service station owner to infer at the 10% significance level that new car owners tune up their cars more frequently than older car owners?

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Definitions:

Stock Dividends

Dividends paid to shareholders in the form of additional shares of stock instead of cash.

Contributed Capital

The total value of the cash and other assets received by a company from its shareholders in exchange for stock, also known as paid-in capital.

Preferred Stock

A class of ownership in a corporation with a higher claim on assets and earnings than common stock, often paying fixed dividends.

Callable Preferred Stock

A type of preferred stock that gives the issuer the right to redeem the stock at a predetermined price after a certain date.