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The Reliability of Two Types of Machines Used in the Same

question 96

Essay

The reliability of two types of machines used in the same manufacturing process is to be tested. The first machine failed to operate correctly in 90 out of 300 trials while the second type failed to operate correctly in 50 out of 250 trials.
a.Give a point estimate for the difference between the population proportions of these machines.
b.Calculate the pooled estimate of the population proportion.
c.Carry out a hypothesis test to check whether there is a statistically significant difference in the reliability for the two types of machines using a .10 level of significance.


Definitions:

Trade-in

An asset given as part-payment for the purchase of a new asset, usually in the context of vehicles.

Commercial Substance

A situation where the future cash flows of an entity change as a result of a transaction, indicating the transaction has economic significance.

Original Cost

The initial purchase price or construction cost of an asset or investment, before depreciation or amortization.

Units-of-production

An approach to depreciation that apportions the price of an asset throughout its functional life, contingent on the total units it generates.

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