Assignment 3: Data Analysis

Assignment 3: Data Analysis

Solution # 01

Insurance Company claims about 90% claims has noticed in one month (30 days) Consumer group selected 80 of the Company's claims for testing this statement. Company noticed 58 claims were settled in one month (30 days) (Hamilton, 1964).

Part (a) 95% Confidence Interval

H0: p = 0.90 or 90%

Ha: p < 0.90 or 90%

a = Level of significance, 0.05

Since the given hypothesis is less, so the confidence intervals lie on the left side

-Za= -1.645 (This value has found in the Normal Approximation Standard Table)

Test Statistics

Z0 = X/µ - p/ under root (p (1-p))/n

Z0 = 58/80-0.90 / under root (0.90(1.0.90))/80

Z0 = 0.725-0.90 / 0.03354

= -5.217

Decisions

Za > Z tab

-1.645 > -5.217

Reject H0 because the calculated value is lesser than the tabulated value, which defines that the rejection of the null hypothesis.

Conclusion

The sample data demands rejection of the claim which further defines the 90% of the company's targeted claim percentage on insurance claims are developed within 30 days at the given a = 0.05 level of significance.

Part (b) Assumptions

Rules of Thumb

A rule of thumb is a principle for providing accurate and authentic sample values. This method has used in hypothesis techniques for estimating the exact values of the given population. Further, the estimating will help to provide the better estimation and the learning sources.

Part (c) Minimum Sample Size

The minimum sample size is required when we have to estimate population proportion of claims that adjusted by the insurance company for 30 days claims.

The 95% confidence intervals has used in this situation by using the lower and upper class boundaries. Both ranges define the total estimation values of the given hypothesis.

Conservative Method

Suppose, if we do not have any defined concept of sample proportion than for overcome this we use conservative method. If we have to estimate 95% CI with error 0.04, than conservative sample size is define as

n = z^2 (p) (1-p)/ error^2

n = (1.64^2) (0.5) (1-0.5)/ (0.04) ^2

n = 600.25

We could reject the fraction value and round off the obtain answer such as 601.

Solution # 02

The dataset of cardio hospitals women patients defines the accurate number of hypertensive patients. This data further divide in both types who have hypertensive problem or do not have hypertensive problem.

Part (a) Mean & Standard Deviation

The mean and standard deviation values of the Framingham Heart study patient's data are as follows:

Descriptive Statistics

N

Mean

Std. Deviation

Hypertension

498

.46

.499

Body Mass Index (kg/sqm)

497

25.66

3.956

Valid N (list wise)

497

Interpretation

The data set consists of women physical problem such as hypertensions. Two types of cases have deal in this data set women who have hypertension disease or women who do not have hypertension disease (Conover & Iman, 1981). Out of 498 total population 53.6 percent women do not have hypertension problem, while the remaining 46.4 percent women have the hypertension disease. The Mean value defines the average estimation of the total population. The standard deviation value determines that how far is from the average value. The hypertension and body mass index have the relationship because, as the body mass ...