A car salesman claims that the variance of prices on convertibles is higher than the variance of prices on station wagons. The standard deviation of the list price on 16
Convertibles is $6800 and the standard deviation on 24 station wagons is $3900. What
Should the test value be?
A) 2.25
B) 3.04
C) 1.74
D) 1.53

Question

Quizplus · Accepted Answer

The test value is calculated using the formula for the F-test: F = (s1^2 / s2^2), where s1 is the standard deviation of convertibles and s2 is the standard deviation of station wagons. So, F = (6800^2 / 3900^2) = 3.04.

A Car Salesman Claims That the Variance of Prices on Convertibles