Math Problem Statement

An insurance company wants to know if the color of an automobile has a relationship with the number of moving violations. The following contingency table gives the results of data collected from police reports across the nation. The columns list the numbers of reported moving violations in a year. Use a level of significance of α=0.01α=0.01 to conduct a hypothesis test of association between automobile color and the number of moving violations. Observed Sample of Cars0–12–3More Than 3TotalWhite

52

33

30

115

Black

75

77

26

178

Red

25

22

21

68

Silver

39

41

18

98

Other

52

67

35

154

Total

243

240

130

613 Step 3 of 4 :  

Compute the value of the test statistic. Round your answer to three decimal places, if necessary. (Note: If calculating by hand, be sure to use at least six decimal places in numbers for all intermediate calculations to ensure accuracy of the result.)

Solution

To conduct a hypothesis test of association between automobile color and the number of moving violations, we can use the Chi-Square Test of Independence. We are provided with a contingency table, and we need to compute the value of the test statistic.

Here is a step-by-step approach:

Step 1: Set up the observed values (O)

We already have the observed values from the contingency table.

Color/Violations0–12–3More than 3Total
White523330115
Black757726178
Red25222168
Silver39411898
Other526735154
Total243240130613

Step 2: Compute the expected values (E)

The expected value for each cell is calculated using the formula:

E=(Row Total)×(Column Total)Grand TotalE = \frac{(\text{Row Total}) \times (\text{Column Total})}{\text{Grand Total}}

We'll calculate the expected values for each cell:

Eij=(Row Total for i)×(Column Total for j)613E_{ij} = \frac{(\text{Row Total for } i) \times (\text{Column Total for } j)}{613}

For example, the expected value for the first cell (White, 0–1 violations) is:

EWhite,01=115×243613=45.585E_{White, 0-1} = \frac{115 \times 243}{613} = 45.585

We'll compute all the expected values.

Step 3: Compute the Chi-Square test statistic

The Chi-Square test statistic is given by:

χ2=(OE)2E\chi^2 = \sum \frac{(O - E)^2}{E}

Where:

  • OO is the observed value
  • EE is the expected value

Let me calculate this now.The value of the test statistic for the Chi-Square test is χ2=16.862\chi^2 = 16.862, rounded to three decimal places.

Would you like to see the next steps or have any questions on the process so far?

Here are five related questions that might interest you:

  1. How do we determine the critical value for the Chi-Square test?
  2. What are the degrees of freedom for this test?
  3. How do we interpret the results of the Chi-Square test?
  4. What assumptions are made when using the Chi-Square test of independence?
  5. How would the test result change if we used a different significance level?

Tip: Ensure your expected values are sufficiently large (at least 5) to meet the assumptions of the Chi-Square test for reliable results.

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Math Problem Analysis

Mathematical Concepts

Statistics
Chi-Square Test of Independence
Contingency Tables
Hypothesis Testing

Formulas

Expected Value Formula: E = (Row Total * Column Total) / Grand Total
Chi-Square Test Statistic: χ² = Σ((O - E)² / E)

Theorems

Chi-Square Test Theorem

Suitable Grade Level

Undergraduate/Advanced High School (Grades 11-12)