Fuel Consumption for Cars Made in the US and Japan Quantitative Research

Exclusively available on Available only on IvyPanda® Made by Human No AI

The 2007 global economic recession left devastating financial problems with many companies. After failing to recover from the effects of the recession, many firms turned to cost cutting as the main business strategy. In this regard, a tour company called company A uses cars made in the United States to transport clients. The firm wishes to cut costs by using cars with low fuel consumption.

To achieve this, the firm’s management launched a survey to determine where they could purchase cars with low fuel consumption. After consulting with players in the motor industry, it was revealed that cars made in Japan consume less fuel than cars made in the United States. To find out if this allegation was true, company A decided to collect data regarding fuel consumption for cars made in the US and Japan.

Research question: is fuel consumption for cars made in the US different from fuel consumption for cars made in Japan?

Since the researcher does not know the category of cars that consumes more fuel, a two-sided test is appropriate (Hazewinkel, 2001). The null hypothesis will be: Cars made in the US consume the same amount of fuel as cars made in Japan. This is tested against alternative hypothesis which says that the two categories of cars do not consume the same amount of fuel.

  • H1: µ1 = µ2, against
  • H2: µ1 ≠ µ2.

The test involves two samples which are independent from each other (Hazewinkel, 2001). In each sample, there are two variables to be measured. The independent variable will be the number of gallons and the dependent variable will be the number of miles covered. This means that the number of miles covered depends on the number of gallons available. The cars that cover more miles with one gallon use less fuel.

Since the study involves comparing means of two populations, t-test or z-test can be used (Kaye & Freedman, 2011). But z-test can only be used if population means and standard deviations are known (Kaye & Freedman, 2011). In this case, both the means and standard deviations for the two populations are unknown.

This means that z-test cannot be used. Therefore, t-test is used. To use t-test, the variables are assumed to be normally distributed and the samples independent.

In the analysis, t-value will be determined from the data of collected samples. T-critical will be obtained from the t-table using (n1+n2-2) degree of freedom and a significance level of 0.05 (Kaye & Freedman, 2011). The null hypothesis is rejected if the absolute value of t is greater than t-critical (Kaye & Freedman, 2011).

From the two sets of data collected, the following results were obtained

For the first sample (Cars made in the US), sample size n1 = 248. Mean fuel consumption ẋ1 = 20.05 miles per gallon. Standard deviation s1 = 6.311. Standard error = s1/sqrt (n1) = 6.311/sqrt248 = 0.4007.

For the second sample (cars made in Japan), the sample size n2 = 78. Mean fuel consumption ẋ2 = 30.381. Standard deviation s2 = 6.008. Standard error = s2/sqrtn2 = 6.008/sqrt78 = 0.680.

T =(ẋ1 – ẋ2)/sp(sqrt [(1/n1) + (1/n2)]), where sp is the pooled standard deviation. sp² = [(n1-1)s1² + (n2-1)s2²] / (n1 + n2 – 2) =[(249-1)6.311²+(79-1)6.008²]/(248+78-2) =[(248)39.8287+(78)36.0961]/324=39.1760. Therefore, sp = 6.2591. This means that t = (30.381 – 20.05) / 6.2591(sqrt[(1/248) + (1/78)]) = -12.7143. The degree of freedom, df = n1+n2-2 = 248+78-2 = 324.

At a significance level of 0.05, t-critical = 1.6496 (from t-table). The null hypothesis is rejected since the absolute value of t = 12.7143 is greater than t-critical = 1.6496.

Therefore, the alternative is accepted. Fuel consumption for cars made in the US is different from fuel consumption for cars made in Japan. The observed difference in means was not due to chance or random error. Therefore, company A can proceed and acquire cars from Japan.

References

Hazewinkel, M. (2001). Student’s test. Journal of Mathematicsand Statistics. 5(2): 5-9.

Kaye, D. H. & Freedman D. A. (2011). Reference Guide on Statistics. Washington D.C: West National Academies.

More related papers Related Essay Examples
Cite This paper
You're welcome to use this sample in your assignment. Be sure to cite it correctly

Reference

IvyPanda. (2019, July 5). Fuel Consumption for Cars Made in the US and Japan. https://ivypanda.com/essays/fuel-consumption-for-cars-made-in-the-us-and-japan/

Work Cited

"Fuel Consumption for Cars Made in the US and Japan." IvyPanda, 5 July 2019, ivypanda.com/essays/fuel-consumption-for-cars-made-in-the-us-and-japan/.

References

IvyPanda. (2019) 'Fuel Consumption for Cars Made in the US and Japan'. 5 July.

References

IvyPanda. 2019. "Fuel Consumption for Cars Made in the US and Japan." July 5, 2019. https://ivypanda.com/essays/fuel-consumption-for-cars-made-in-the-us-and-japan/.

1. IvyPanda. "Fuel Consumption for Cars Made in the US and Japan." July 5, 2019. https://ivypanda.com/essays/fuel-consumption-for-cars-made-in-the-us-and-japan/.


Bibliography


IvyPanda. "Fuel Consumption for Cars Made in the US and Japan." July 5, 2019. https://ivypanda.com/essays/fuel-consumption-for-cars-made-in-the-us-and-japan/.

If, for any reason, you believe that this content should not be published on our website, please request its removal.
Updated:
This academic paper example has been carefully picked, checked and refined by our editorial team.
No AI was involved: only quilified experts contributed.
You are free to use it for the following purposes:
  • To find inspiration for your paper and overcome writer’s block
  • As a source of information (ensure proper referencing)
  • As a template for you assignment
Privacy Settings

IvyPanda uses cookies and similar technologies to enhance your experience, enabling functionalities such as:

  • Basic site functions
  • Ensuring secure, safe transactions
  • Secure account login
  • Remembering account, browser, and regional preferences
  • Remembering privacy and security settings
  • Analyzing site traffic and usage
  • Personalized search, content, and recommendations
  • Displaying relevant, targeted ads on and off IvyPanda

Please refer to IvyPanda's Cookies Policy and Privacy Policy for detailed information.

Required Cookies & Technologies
Always active

Certain technologies we use are essential for critical functions such as security and site integrity, account authentication, security and privacy preferences, internal site usage and maintenance data, and ensuring the site operates correctly for browsing and transactions.

Site Customization

Cookies and similar technologies are used to enhance your experience by:

  • Remembering general and regional preferences
  • Personalizing content, search, recommendations, and offers

Some functions, such as personalized recommendations, account preferences, or localization, may not work correctly without these technologies. For more details, please refer to IvyPanda's Cookies Policy.

Personalized Advertising

To enable personalized advertising (such as interest-based ads), we may share your data with our marketing and advertising partners using cookies and other technologies. These partners may have their own information collected about you. Turning off the personalized advertising setting won't stop you from seeing IvyPanda ads, but it may make the ads you see less relevant or more repetitive.

Personalized advertising may be considered a "sale" or "sharing" of the information under California and other state privacy laws, and you may have the right to opt out. Turning off personalized advertising allows you to exercise your right to opt out. Learn more in IvyPanda's Cookies Policy and Privacy Policy.

1 / 1