Setting premiums for insurance is a complex task. If the premium is too high, the insurance company will lose customers; if it is too low, the company will lose money. Statistics plays a critical role in almost all aspects of the insurance business. As part of a statistical analysis, an insurance company in Florida studied the relationship between the severity of car crashes and the ages of the drivers. A random sample of crashes in 2002 in the state of Florida was drawn. For each crash, the age category of the driver was recorded as well as whether the driver was injured or killed. The data were stored as follows:
Column 1: Crash number
Column 2: Age category
1. 5 to 34
2. 35 to 44
3. 45 to 54
4. 55 to 64
5. 65 and over Column 3: Medical status of driver
1 = Uninjured
2 = Injured (but not killed)
3 = Killed
a. Is there enough evidence to conclude that age and medical status of the driver in car crashes are related?
b. Estimate with 95% confidence the proportion of all Florida drivers in crashes in 2002 who were uninjured.

  • CreatedFebruary 03, 2015
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