In: Statistics and Probability
It is desired to determine whether there is less variability in the silver plating done by Company 1 than in that done by Company 2. If independent random samples of size 12 of the two companies’ work yield standard deviations s1 = 0.035 mil and s2 = 0.062 mil respectively, test the null hypothesis that there is no difference in variances (σ1^2 = σ2^2) against the alternative hypothesis that variance of company 1 is smaller as compared to variance of company 2 (σ1^2 < σ2^2) at the 0.05 level of significance.