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Mathematics, 19.07.2020 01:01 jameslinimk

An automobile club pays for emergency road services (ERS) requested by its members. The current policy rate the automobile club pays is based on the thought that 20% of services requested will be serious mechanical problems requiring towing. However, the insurance company claims that the auto club has a higher rate of serious mechanical problems requiring towing services. Perform a hypothesis test at the 5% level (after checking assumptions) to test the insurers claim. Upon examining a sample of 2927 ERS calls from the club members, the club finds that 1499 calls related to starting problems, 849 calls involved serious mechanical failures requiring towing, 498 calls involved flat tires or lockouts, and 81 calls were for other reasons. Required:
a. Estimate the true proportion of ERS calls that involved serious mechanical problems requiring towing and construct a 95% confidence interval after checking that conditions have been net. Interpret your interval in context.

b. Calculate a 98% confidence interval for the true proportion of ERS calls that related to starting problems after checking that conditions have been met. Interpret your interval in context.
c. The current policy rate the automobile club pays is based on the thought that 20% of services requested will be serious mechanical problems requiring towing. However, the insurance company claims that the auto club has a higher rate of services due serious mechanical problems requiring towing. Perform a hypothesis test at the 5% level (after checking assumptions) to test the insurers claim. Compare this finding and process with that from a.

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