Question

Not sure if any of the filled in answers are correct, so all would be appreciated.

A loan officer compares the interest rates for 48-month fixed-rate auto loans and 48-month variable-rate auto loans. Two independent, random samples of aut rates are selected. A sample of eight 48-month fixed-rate auto loans had the following loan rates: 4.29% 3.75% 3.50% 3.99% 3.75% 3.99% 5.40% 4.00% 3.59% 2.75% 2.99% 2.50% 3.00% Figure 10.7 FIGURE 10.7 Excel Output of Testing the Equality of Mean Loan Rates for Fixed and Variable 48-Month Auto Loans (for Exercise 10.12) t-Test: Two-Sample Assuming Equal Variances Fixed-Rate (%) 4.0838 0.3376 Variable-Rate (%) 2.966 0.1637 Mean Variance Observations Pooled Variance Hypothesized Mean Difference df t Stat P(T<-t) one-tail t Critical one-tail P(T<-t) two-tail t Critical two-tail 0.2744 3.7431 0.0016 1.7959 0.0032 2.2010 (a) Set up the null and alternative hypotheses needed to determine whether the mean rates for 48-month fixed-rate and variable-rate auto loans differ. versus Ha Hf V (b) Figure 10.7 gives the Excel output of using the equal variances procedure to test the hypotheses you set up in part a. Assuming that the normality and equ variances assumptions hold, use the Excel output and critical values to test these hypotheses by setting α equal to .10-05-01, and .001. How much evidence there that the mean rates for 48-month fixed-and variable-rate auto loans differ? (Round your answer to 3 decimal places.) 3.743 with 11 df Reject Ho at α- 0.01 and 0.001 Strong but not at 0.1 and 0.05 V evidence that rates differ (c) Figure 10.7 gives the p-value for testing the hypotheses you set up in part a. Use the p-value to test these hypotheses by setting α equal to .10, .05, .01, a 001. How much evidence is there that the mean rates for 48-month fixed and variable-rate auto loans differ? (Round your answer to 4 decimal places.) p- value- 0.0032 Reject Ho at α- 0.1. 0.05, and 0.01 but not at 0.00 1 Strong evidence (d) Calculate a 95 percent confidence interval for the difference between the mean rates for fixed and variable-rate 48-month auto loans. Can we be 95 percer confident that the difference between these means is exceeds.4 percent? (Round your answers to 3 decimal places.) Confidence interval Γ (e) Use a hypothesis test to establish that the difference between the mean rates for fixed and variable-rate 48-month auto loans exceeds .4 percent. Use 0.461 ,the entire interval is above ec 05. (Round your t answer to 3 decimal places and other answers to 1 decimal place.) 2.404 Reject He with a-.05.

Answer 1