16.33 Potential insurance fraud?
Insurance adjusters are concerned about the high estimates they are receiving from Jocko’s Garage. To see if the estimates are unreasonably high, each of the 10 damaged cars was taken to Jocko’s and to another garage, and the estimates (in dollars) were recorded. Here are the results.
fraud
| Car | 1 | 2 | 3 | 4 | 5 |
| Jocko’s | 1410 | 1550 | 1250 | 1300 | 900 |
| Other | 1250 | 1300 | 1250 | 1200 | 950 |
| Car | 6 | 7 | 8 | 9 | 10 |
| Jocko’s | 1520 | 1750 | 3600 | 2250 | 2840 |
| Other | 1575 | 1600 | 3380 | 2125 | 2600 |
Test the null hypothesis that there is no difference between the two garages. Remember that zeros are dropped from the data before ranking, so that is the number of nonzero differences within pairs.
16.33
H0: There is no difference in the distribution of estimates between Jocko's garage and the other garage. Ha: Jocko's estimates are systematically higher than the other garage's estimates. . , . , . Jocko's estimates are systematically higher than the other garage's estimates.