1.Write down five situations where Testing of Hypothesis is required.

1. For each of those situations, state the Null and the Alternate hypotheses.
2. For each of those situations, explain the reason behind choosing either a two tailed or one tailed test.
3. Discuss the Business Impact on the outcome of the test conducted.

Illustration:

Situation: An automotive company has designed a new engine, which claims betterfuel efficiency. The old engine gave fuel efficiency of 17 kmpl of diesel. After testing the new engine it reported an efficiency of 21 kmpl. The wish to test whether the sample mean of 21 kmpl is significantly different to population mean of 17kmpl.

Hypotheses:

Ho: Mean Fuel efficiency of new engine is not significantly different from the mean fuel efficiency of the old engine.

OR Ho: x17

Ha: Mean Fuel efficiency of new engine is not significantly different from the mean fuel efficiency of the old engine

Ha: x>17

Reason:The reason behind choosing a one tailed test is as follows __________

Business Impact: A better fuel efficiency ensures additional sales in the lower-mid and mid-segments of car buyers _____________