The McFarland Insurance Company Claims Department reports the mean cost to process a claim is $60. An industry comparison showed this amount to be larger than most other insurance companies, so the company instituted cost-cutting measures. To evaluate the effect of the cost-cutting measures, the Supervisor of the Claims Department selected a random sample of 26 claims processed last month.

He is interested to investigate: At the .01 significance level is it reasonable a claim is now less than $60?
Denote %u03BC to be the population mean of processing cost of a claim. How should he set up the null hypothesis (H0)?

Answer rating: 100% (QA)

H0 60 This null hypothesis states that the population mean processing cost of a claim is greater than or equal to 60 This hypothesis is set up to inve... View the full answer