Question

A manufacturing company is purchasing metal pipes of standard length from two different suppliers, ABC and XYZ. In the past two months there are increasing complaints by the Production Manager that delivery times by ABC present higher variability in comparison to the delivery times by XYZ. The Production Manager is worried that this variability will make it harder to efficiently schedule the production process.

If the variance of XYZ remains unchanged, what should be the variance of ABC in order to reject the null hypothesis at 5% significance level?

Order	Supplier ABC		Order	Supplier XYZ
1	35		1	19
2	26		2	23
3	26		3	22
4	30		4	21
5	25		5	26
6	20		6	24
7	24		7	23
8	25		8	17
9	19		9	24
10	27		10	21
11	29		11	28
12	25		12	30
13	12		13	20
14	20		14	34
15	22		15	23
16	17		16	26
17	21		17	28
18	16		18	28
19	32		19	26
20	23		20	30
21	29		21	36
22	22		22	22
23	12		23	20
24	28		24	22
25	24		25	21
26	27
27	18

Answer 1

Answers:

H0 hypothesis
Since p-value > α, H0 is accepted.
The sample standard deviation (S) of Supplier ABC's population is considered to be equal to the sample standard deviation (S). of the Supplier XYZ's population.
In other words, the difference between the sample standard deviation (S) of the Supplier ABC and Supplier XYZ populations is not big enough to be statistically significant.