P1

gine you are a market researcher who works for SaveSmart, a discount insurance company. The company's management has become aware of some dissatisfaction among customers who have switched to SaveSmart from other insurance carriers. They want you, their market researcher, to determine if the majority of customers who have switched to SaveSmart really are dissatisfied with the switch, and if the dissatisfaction could stem from their advertised claim that customers on average save $432 on their yearly premiums. You start with the $432 amount that is advertised as the average yearly savings. You want to check to see if this is perhaps an overestimate of the amount actually saved. You randomly sample 82 customers who switched to SaveSmart from another insurance carrier, and find an average savings of $415 with a standard deviation of $102. 1) Complete the 6 steps for a hypothesis test at the 5% level of significance to determine if the $432 average savings is an overestimate. 2) Calculate a 90% confidence interval for the average amount of savings of all customers who switch their insurance to SaveSmart. Interpret the interval in this context and comment on whether or not the confidence interval agrees with the conclusion of the hypothesis test. You now move on to the next part of your task. While gathering data about yearly savings, you also asked the customers who had switched to SaveSmart, "Are you satisfied with your decision to switch your insurance to SaveSmart?" 61% of the respondents said, "No." I pro: 2 interval 3) Complete the 6 steps for a hypothesis test at the 3% level of significance to determine if these data provide strong evidence that the majority of customers who switched to SaveSmart are NOT satisfied with their decision. 4) Calculate a 94% confidence interval for the proportion customers who were not satisfied with their decision to switch to SaveSmart. Interpret the interval in this context and comment on whether or not the confidence interval agrees with the conclusion of the hypothesis test. P"Based on your conclusions from Questions 1 through 4, write a paragraph to SaveSmart's CEO, summarizing your findings to your task: "They want you, their market researcher, to determine if the majority of customers who have switched to SaveSmart really are dissatisfied with the switch, and if the dissatisfaction could stem from their advertised claim that customers on average save $432 on their yearly premiums." (The company CEO has never taken a statistics course, so you'll need to write your paragraph in a way that will make sense to someone with no formal statistics training.)