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    Example 5

    Uploaded by

    Deval Patel
    The president of a large company is deciding whether to implement a lunchtime exercise program to improve employee health and reduce medical expenses. Medical expenses were recorded for 12 months before and after an exercise program was introduced in one office. The data shows lower average monthly medical expenses after the program. A statistical t-test found the difference in mean expenses before and after to be statistically significant, indicating exercise programs reduce medical expenses. The mean monthly savings was estimated to be $3,083 with 95% confidence.

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    Example 5

    Uploaded by

    Deval Patel
    75 views2 pages
    The president of a large company is deciding whether to implement a lunchtime exercise program to improve employee health and reduce medical expenses. Medical expenses were recorded for 12 months before and after an exercise program was introduced in one office. The data shows lower average monthly medical expenses after the program. A statistical t-test found the difference in mean expenses before and after to be statistically significant, indicating exercise programs reduce medical expenses. The mean monthly savings was estimated to be $3,083 with 95% confidence.

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    The president of a large company is deciding whether to implement a lunchtime exercise program to improve employee health and reduce medical expenses. Medical expenses were recorded for 12 months before and after an exercise program was introduced in one office. The data shows lower average monthly medical expenses after the program. A statistical t-test found the difference in mean expenses before and after to be statistically significant, indicating exercise programs reduce medical expenses. The mean monthly savings was estimated to be $3,083 with 95% confidence.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Download as xlsx, pdf, or txt
    75 views2 pages

    Example 5

    Uploaded by

    Deval Patel
    The president of a large company is deciding whether to implement a lunchtime exercise program to improve employee health and reduce medical expenses. Medical expenses were recorded for 12 months before and after an exercise program was introduced in one office. The data shows lower average monthly medical expenses after the program. A statistical t-test found the difference in mean expenses before and after to be statistically significant, indicating exercise programs reduce medical expenses. The mean monthly savings was estimated to be $3,083 with 95% confidence.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Download as xlsx, pdf, or txt
    of 2

    Month Before After The president of a large company is in

    Jan 68 59 the process of deciding whether to adopt a lunchtime


    Feb 44 42 exercise program. The purpose of such programs
    Mar 30 20 is to improve the health of workers and, in
    Apr 58 62 so doing, reduce medical expenses. To get more
    May 35 25 information, he instituted an exercise program for
    Jun 33 30 the employees in one office. The president knows
    Jul 52 56 that during the winter months medical expenses
    Aug 69 62 are relatively high because of the incidence of colds
    Sep 23 25 and flu. Consequently, he decides to record medical
    Oct 69 75 expenses for the 12 months before the program and
    Nov 48 40 for 12 months after the program. The “before” and “after”
    Dec 30 26 expenses (in thousands of dollars) are compared on
    a month-to-month basis and shown here.
    a. Do the data indicate that exercise programs
    reduce medical expenses? (Test with α = .05.)
    b. Estimate with 95% confidence the mean savings
    produced by exercise programs.

    Month Before After Difference H0


    Jan 68 59 9 Ha
    Feb 44 42 2
    Mar 30 20 10
    Apr 58 62 -4 Right tail test
    May 35 25 10
    Jun 33 30 3 Significance level
    Jul 52 56 -4
    Aug 69 62 7 Critical value
    Sep 23 25 -2
    Oct 69 75 -6 Mean sample difference
    Nov 48 40 8 Standard deviation of differences
    Dec 30 26 4 Sample size

    test statistic

    Reject the H0

    Expenses were high before and the exercise pro


    mu d <= 0
    mu d > 0

    0.05

    1.795885

    3.083333
    5.884623
    12

    1.815066

    before and the exercise program was benificial

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