chapter exercises 9.64?
64 An auditor reviewed 25 oral surgery insurance claims from a particular surgical office, determining that the mean out-of-pocket patient billing above the reimbursed amount was $275.66 with a standard deviation of $78.11. (a) At the 5 percent level of significance, does this sample prove a violation of the guideline that the average patient should pay no more than $250 out-of-pocket? State your hypotheses and decision rule. (b) Is this a close decision?
- GuillermoLv 710 years ago
Let X be the oral surgery insurance claims
n = 25
Xmean = 275.55
SD = 78.11
H0: μx ≤ 250
H1: μx > 250, α = 0.05
If (275.55 - 250)/(78.11/5) > Z(1 - 0.05), we reject H0.
If 1.63 ≯ 1.645, we don't reject H0.
With a confidence of 95%, we conclude that the sample doesn't prove a violation of the guideline.
I we work with that grade of confidence, this isn't a closed decision!Source(s): Standardized Normal Distribution.
- Anonymous10 years ago
No, because ObamaCare would give the people their out-of-pocket money back after stealing it from the hard-working successfull Americans.