PROBLEM 19

The variance in a production process is an important measure of the quality of the

process. A large variance often signals an opportunity for improvement in the
process by finding ways to reduce the process variance .Conduct a statistical test to
determine whether there is a significant difference between the variances in the bag
weights for the two machines. Use a 0.05 level of significance. What is your
conclusion? Which machine, if either , provides the greater opportunity for quality
improvements?2.95 3.45 3.5 3.75 3.48 3.26 3.33 3.2

3.16 3.2 3.22 3.38 3.9 3.36 3.25 3.28

MACHINE 1
3.2 3.22 2.98 3.45 3.7 3.34 3.18 3.35

3.12

3.22 3.3 3.34 3.28 3.29 3.25 3.3 3.27

MACHINE 2 3.38 3.34 3.35 3.19 3.35 3.05 3.36 3.28

3.3 3.28 3.3 3.2 3.16 3.33

Solution :
Step1: Situation: To improve the quality of the process.
Role: Production manager of the Manager

Step2: Research Hypothesis

To check if there is significant difference between the variance of the bag weights
produced by the two machines.
σ12 ≠ σ22
Step3: Given Machine 1 Machine 2

Sample mean 3.3284 3.278181818

Sample standard deviation 0.221108571 0.076819911

Sample size 25 22
Step 4: Construction of statistical hypothesis
Null hypothesis H0 σ12 = σ22

Alternate hypothesis H1 σ12 ≠ σ22

Step 5:Types of Errors

Type 1 error : P(Reject H0 | Not Reject H0 )
P(σ12 ≠ σ22 | σ12 = σ22) = α
Type 2 error: P(Not Reject H0|Reject H0 ) =β
P(σ12 = σ22 | σ12 ≠ σ22) = β
1- β = Power of the test
Step 6:Construction of test statistics
Assuming that both populations are independently normal
∴ Under H0, F0= s12/s22 ~Fn-1,n-2 dif
∴ From the given data F0= 8.284448
Step 7: Decision
Alternative Hypotheses: H1 : σ12 ≠ σ22
Type of test: Two Tailed Test Non-Critical Critical
Region Region 5%
Using Excel, We get P-value
F.DIST.(8.2844488,24,21,True)
F.DIST.RT(8.2844488,24,21)
∴ P-Value ≈ 0.00001
Since P-value < α, We reject H0. There is a significant difference in terms of the bag
weights produced by the machines.
To find which machine has more opportunity for improvement
Let’s consider a different set of Hypothesis
Research Hypothesis : σ12 > σ22
Null Hypothesis: σ12 ≤ σ22
Alternate Hypothesis :σ12 > σ22
Test statistics:
Under Ho, F0= s12/s22 ~Fn-1,n-2 dif
∴ From the given data F0= 8.284448. P-Value ≈ 0.00001
Thus P < α, hence null hypothesis H0 rejected . Hence machine 1 has higher
opportunity for improvement.
Managerial Implications
Company:
Machine 1 might be old hence due to wear and tear there is a lot of variation in the
weight of the bag produced. Hence we can do a maintenance check or replace the
machine with a new one.
Production Manager:
A quality standard method can be used to check uniformity of bag weights produced.
Check other reason that might be causing this non-uniformity.
Supplier:
The quality of raw material supplied might also affect the bag weight hence the
supplier has to do necessary quality checks before supplying