STAT6202 Exercises 9

1. The manager of a semiconductor company is concerned at the proportion of printed circuit boards (PCBs)
that are returned as faulty: currently one in five are being returned. Suspecting that many of the faults
might be occurring during transit to customers, the manager takes a random sample of 16 PCBs before
transit and finds that 2 are faulty. Is there evidence that the proportion of pcbs that are faulty before transit
is less than the one in five? (Use a suitable significance test: state the null and alternative hypotheses, cal-
culate the P -value, draw your statistical conclusion based on the P-value and interpret your conclusion.)

2. A new manager is appointed to a car insurance office to try to increase policy renewal rate (i.e., the
proportion of clients who renew their policies with the company), which historically has been 0.82. The
new manager makes changes to the office and customer care systems and six months later a random
sample of 160 clients shows that 138 had renewed their policies.

(a) Is there significant evidence that the renewal rate has changed? (State the null and alternative
hypotheses and calculate the P -value using a Normal approximation to the relevant binomial tail
probability.)
(b) Calculate an approximate 95% confidence interval for the renewal rate. Interpret the interval.
(c) Is your answer to (b) in line with your conclusion in (a)?

3. Historically, 60 percent of commuters in a city use the rail transport system. After a new motorway to
the city is opened, a survey of 1000 found that 559 people were still using the rail system.

(a) Is there significant evidence that the proportion of commuters using the rail system has changed?
(Again calculate the P -value as in question 2(a).)
(b) Calculate an estimate, and its standard error, of the proportion of commuters using the rail system.
Calculate a 95% confidence interval for the proportion.
(c) Write a one or two sentence conclusion based on (a) and (b).

4. Traffic accidents involving drivers in a large transport company happen at an average rate of 18 accidents
per year. In order to comply with new Government regulations, the working hours of the drivers are
reduced. In the following year there are 13 accidents involving the company’s drivers. We would like to
test whether the reduced working hours may have lead to a change in the annual accident rate.

Let X represent the (random) number of accidents in a year and let µ be the accident rate
(i.e., the average number of accidents per year involving this company’s drivers) after the new
regulations come into effect. Assume that X has a Poisson distribution with mean µ.

(a) Write down the null and alternative hypotheses in terms of µ.

(b) Calculate P (X ≤ 13) assuming that the null hypothesis is true.
(c) Is there evidence that the accident rate may have changed as a result of the new regulations?
(d) Answer part (c) supposing that there were only 10 accidents in the next year (instead of 13).
(e) Comment on whether you think the Poisson distribution is appropriate for this situation.
5. In a survey of households from England and Wales, each household in a random sample was asked
whether they own a video recorder. Of 5720 households in England, 4547 owned a video, and of 339
households in Wales, 267 owned a video. (Source: Family Spending, 1997.)

(a) Present a table showing, for each country, the total numbers of households, the proportion of these
owning a video and the standard error of this proportion. Label the rows and columns of your table
and write an informative caption.
(b) Comment briefly on how video ownership compares for the two countries. (Pay attention to the
standard errors when comparing the two proportions.)