Question: In order to test the puncture resistance of the new SDsandtrak tyre, a new type of off-road vehicle tyre, 120 of the new tyres and

In order to test the puncture resistance of the new SDsandtrak tyre, a new type of off-road vehicle tyre, 120 of the new tyres and 180 standard SD tyres are driven over the same hazardous 500-kilometre course in Central Australia. Just six of the SDsandtrak tyres are punctured whereas 18 of the standard SD tyres have to be replaced due to punctures.

a. Can it be concluded that the puncture rate of the new SDsandtrak is significantly different from the puncture rate of normal tyres, at the 1% level of significance?

b. Why has it been decided to set the significance level at a low 1%?

What is the consequence if a 5% level had been chosen?

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