Automobile collision insurance is used to pay for any claims made against the driver in the event of an accident. This type of insurance will typically pay to repair any assets that your vehicle
damages.
(a) Collision claims tend to be skewed right. Why do you think this is the case?
(b) A random sample of 40 collision claims of 20- to 24-year-old drivers results in a mean claim of $4540 with a standard deviation of $2291. An independent random sample of 40 collision claims
of 30- to 59-year-old drivers results in a mean claim of $3670 with a standard deviation of $2029. Using the concept of hypothesis testing, determine if a higher insurance premium should be paid
by 20- to 24-year-old drivers. Use a a=0.01 level of significance, and let population 1 be 20- to 24-year old drivers and population 2 be 30- to 59-year old drivers.