Question
In: Statistics and Probability
A small business pays health insurance for its employees. According to a recent estimate, the average...
A small business pays health insurance for its employees. According to a recent estimate, the average cost that employers pay for health insurance is μ= $4000 per year for a single employee in this industry. The manager of the small business is concerned that their costs are significantly different than the industry average. Data from a sample of employees is used.
Does this small business pay more or less than the average business in their industry? How much more or less?
Use data from the sheet "insurance"
|
The mean difference was 2.9713E-07 |
||
|
The mean difference was 501.9 |
||
|
The business pays MORE than the average business in their industry. |
||
|
The business pays LESS than the average business in their industry. |
| insurance costs per employee |
| 4499 |
| 4252 |
| 5497 |
| 3603 |
| 4240 |
| 4958 |
| 4389 |
| 4367 |
| 4501 |
| 3872 |
| 4449 |
| 4310 |
| 4116 |
| 5022 |
| 5050 |
| 4562 |
| 4368 |
| 4738 |
| 5417 |
| 3999 |
| 4999 |
| 4379 |
| 4367 |
| 4637 |
| 4703 |
| 4437 |
| 4287 |
| 4529 |
| 4262 |
| 4248 |
Solutions
Expert Solution
we know that the formula for mean or average is given as
mean = (sum of all data values)/(total number of data values)
setting the given data values, we get
mean =(4499 + 4252 + ... + 4262 + 4248)/ 30
= 135057/30
= 4501.9
Now, mean difference = calculated mean - given mean
= 4501.9 - 4000
= 501.9
therefore, option B is correct
orchestra answered 1 year agoRelated Solutions
A small business pays health insurance for its employees. According to a recent estimate, the average...
A small business pays health insurance for its employees.
According to a recent estimate, the average cost that employers pay
for health insurance is μ= $4000 per year for a single employee in
this industry. The manager of the small business is concerned that
their costs are significantly different than the industry average.
Data from a sample of employees is used.
Use data from "insurance" in Excel sheet provided
to run the appropriate statistical test. Use α=0.01 . What do...
A company offers health insurance to its employees. The insurance pays continuous premiums at the rate...
A company offers health insurance to its employees. The
insurance pays continuous premiums at the rate of $12,000/year
whenever the employee is sick, and nothing otherwise. Suppose that
a typical employee gets sick on average every 4 months ,and when
sick remains so for an average of 1/2-months. The company
constructs an appropriate continuous-time Markov chain to model
this situation.
(a) Suppose an employee is healthy today. Find the total
expected benefits that she will receive over the next year.
A. Let x be the average number of employees in a group health insurance plan, and...
A. Let x be the average number of employees in a group
health insurance plan, and let y be the average
administrative cost as a percentage of claims.
x
3
7
15
33
70
y
40
35
30
27
17
Make a scatter diagram of the data and visualize the line you
think best fits the data.Use a calculator to verify that
Σx = 128, Σx2 = 6272, Σy =
149, Σy2 = 4743, and Σxy = 2896.
Compute r....
Let x be the average number of employees in a group health insurance plan, and let...
Let x be the average number of employees in a group
health insurance plan, and let y be the average
administrative cost as a percentage of claims.
x
3
7
15
32
72
y
40
35
30
27
17
(a) Make a scatter diagram of the data and visualize the line
you think best fits the data.
Submission Data
(b) Would you say the correlation is low, moderate, or strong?
positive or negative?
moderate and negative strong and
negative low...
Let x be the average number of employees in a group health insurance plan, and let...
Let x be the average number of employees in a group
health insurance plan, and let y be the average
administrative cost as a percentage of claims.
x
3
7
15
38
70
y
40
35
30
26
16
(a) Make a scatter diagram of the data and visualize the line
you think best fits the data.
(b) Would you say the correlation is low, moderate, or strong?
positive or negative?
low and positive
moderate and positive
moderate and negative...
Let x be the average number of employees in a group health insurance plan, and let...
Let x be the average number of employees in a group
health insurance plan, and let y be the average
administrative cost as a percentage of claims.
x
3
7
15
30
73
y
40
35
30
27
20
(c) Use a calculator to verify that Σx = 128,
Σx2 = 6512, Σy = 152,
Σy2 = 4854, and Σxy = 3085. Compute
r. (Round your answer to three decimal places.)
r = ???
Let x be the average number of employees in a group health insurance plan, and let...
Let x be the average number of employees in a group
health insurance plan, and let y be the average
administrative cost as a percentage of claims.
x
3
7
15
40
71
y
40
35
30
28
19
(c) Use a calculator to verify that Σx = 136,
Σx2 = 6924, Σy = 152,
Σy2 = 4870, and Σxy = 3284. Compute
r. (Round your answer to three decimal places.)
r =
Let x be the average number of employees in a group health insurance plan, and let...
Let x be the average number of employees in a group
health insurance plan, and let y be the average
administrative cost as a percentage of claims.
x
3
7
15
31
75
y
40
35
30
26
17
(a) Make a scatter diagram of the data and visualize the line
you think best fits the data.
(b) Would you say the correlation is low, moderate, or strong?
positive or negative?
low and positive strong and negative
strong and positive...
Let x be the average number of employees in a group health insurance plan, and let...
Let x be the average number of employees in a group
health insurance plan, and let y be the average
administrative cost as a percentage of claims.
x
3
7
15
38
71
y
40
35
30
26
17
(b) Would you say the correlation is low, moderate, or strong?
positive or negative?
strong and negative
low and positive
moderate and negative
low and negative
strong and positive
moderate and positive
(c) Use a calculator to verify that Σx =...
Let x be the average number of employees in a group health insurance plan, and let...
Let x be the average number of employees in a group health
insurance plan, and let y be the average administrative cost as a
percentage of claims.
x
3
7
15
37
70
y
40
35
30
26
16
(a) Make a scatter diagram of the data and visualize the line
you think best fits the data.
(b) Would you say the correlation is low, moderate, or strong?
positive or negative?
moderate and negative
low and positive
low and negative...
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