Question

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An auditor reviewed 22 oral surgery Insurance claims from a particular surgical office, determining that the mean out-of-pocket patient billing above the reimbursed amount was $270.86 with a standard deviation of $76.01. 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? (a-1) Hows $250 versus Hu> $250. Choose the right option. a. Reject Holf calc<1721 b. Reject Holf calc>1.721 (a- Calculate the test statistic. (Round your answer to 2 decimal places.) Test statistic (a- The null hypothesis should be rejected. 3) False True (a- The evidence does not show that the average out-of-pocket expense is greater 4) than $250. True False (b)ls this a close decision?

yes

no

Answer 1

a1)

Hence reject H0 if t > 1.721

a2)

Test statistic,
t = (xbar - mu)/(s/sqrt(n))
t = (270.86 - 250)/(76.01/sqrt(22))
t = 1.29

a3)

False

a4)

True

b)
no