Question

The institute for Highway Safety performed a 5 mph crash test on 5 different large luxury cars and 5 different large family cars. The front of each car was driven into an angle barrier and the cost of repairs is given below. It is claimed that the mean cost of repair for the luxury cars is more than that of the family cars. Test the appropriate hypotheses using alpha = 0.05.

Luxury cars	$1953	$1560	$1862	$1893	$1910
Family cars	$1559	$1476	$1332	$1245	$1279

Answer 1

Here we have data:

Luxury cars	Family cars
1953	1559
1560	1476
1862	1332
1893	1245
1910	1279

We use Excel for calculation:

t-Test: Two-Sample Assuming Unequal Variances
	Variable 1	Variable 2
Mean	1835.6	1378.2
Variance	24816.3	17992.7
Observations	5	5
Hypothesized Mean Difference	0
df	8
t Stat	4.943261905
P(T<=t) one-tail	0.000565208
t Critical one-tail	1.859548038
P(T<=t) two-tail	0.001130417
t Critical two-tail	2.306004135