• Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

Is there any link between original price and insurance group, and if so, is it affected by other variables?

Extracts from this document...

Introduction

image00.jpg

Is there any link between original price and insurance group, and if so, is it affected by other variables?

Insurance vs. Original Price

Problem

I want to find out the effect of age on what insurance group a car is in. I am doing this investigation to ensure I get a good deal on my insurance.

Question

Is there any correlation between the original price of a car, and what insurance group it is in? If so, how much correlation?

Hypothesis

I think that the more expensive the car, the higher the insurance rate. This is mainly because the car would be more expensive to replace/pay for. Also, people may think they can drive recklessly or carelessly because they own an expensive car. On the other hand, more expensive cars may be more reliable than older cars, therefore more safe, and be in a lower insurance group.

However, I think there will be medium to high, positive correlation, because of the points above.

Data

I will retrieve my information from a used car statistics sheet from the Internet. This data is from “Gary’s Car Sales”. This lists make, model, price when new, current price, age, colour, engine, fuel, MPG, mileage, service history, owners, length of MOT, tax left(in months), insurance group, no. of doors, style, gearbox, air con, airbags.

Sampling

...read more.

Middle

71050

10420

8

108576400

64

83360

10423

9

108638929

81

93807

10800

9

116640000

81

97200

10810

5

116856100

25

54050

10954

5

119990116

25

54770

12125

5

147015625

25

60625

12590

5

158508100

25

62950

13435

10

180499225

100

134350

13510

10

182520100

100

135100

13586

10

184579396

100

135860

13850

11

191822500

121

152350

14065

9

197824225

81

126585

14505

6

210395025

36

87030

14875

10

221265625

100

148750

17490

12

305900100

144

209880

21586

11

465955396

121

237446

28210

15

795804100

225

423150

32995

20

1088670025

400

659900

Calculations:

n = 32

Σa = 387300

Σe = 237

Σa² = 5809458546

Σe² = 2211

Σae = 3505658

ā = Σa ÷ n

   = 387300 ÷ 32

   = 12103.125

ē = Σe ÷ n

   = 237 ÷ 32

= 7.406 [3dp]

SD of a = √ Σa²/n - ā²

            = √ (5809458546/32) - 146485634.8

            = √ 181545579.563 [3dp] - 146485634.8

            = √ 35059944.763 [3dp]

            = 5921.1439 [3dp]

SD of e = √ Σe²/n - ē²

            = √ (2211/32) - 54.849 [3dp]

            = √ 69.093 [3dp] - 54.849 [3dp]

            = √ 14.245 [3dp]

            = 3.774 [3dp]

Covariance = Σae/n - āē

               = 3505658/32 - 12103.

...read more.

Conclusion

rd owners mark.

Total conclusion

The original question that I asked was “is there any link between original price and insurance group, and if so, is it affected by other variables?”

For an answer I could say yes. It is clear that there is a link between original price and insurance, as there is a very strong Pearson correlation - 0.891. Also, from the data that I had, insurance is affected by colour and possibly by no. of previous owners. The average insurance group was higher for blue cars than red, so it appears that this does in fact affect the insurance group. This may just be chance, and if we took the entire population of blue and red cars, there might be a different result. However, this is just speculation, and from the data we have, insurance group is affected by colour. When I investigated the number of owners against insurance group, the answer was not as apparent, and there wasn’t a clear answer. However, because of line graph data, and part of the mean average data, it is possible that there is correlation, but the data is not conclusive. So, to finally conclude, there is a strong connection and high correlation between original price and insurance group, there is some connection with colour, and possibly a small connection with the number of original owners.

...read more.

This student written piece of work is one of many that can be found in our AS and A Level Probability & Statistics section.

Found what you're looking for?

  • Start learning 29% faster today
  • 150,000+ documents available
  • Just £6.99 a month

Not the one? Search for your essay title...
  • Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

See related essaysSee related essays

Related AS and A Level Probability & Statistics essays

  1. Anthropometric Data

    From this mean point the regression line will pass through it. The mean point should be: Visual checking X=139 (mm) Y=57 (mm) Checking using the calculation Calculator checking Unto the Ti-82 STATS calculator press the STAT button press 4 which is ClrList - 2nd function button 1 comma 2nd function

  2. Statistics. The purpose of this coursework is to investigate the comparative relationships between the ...

    7 43000 2 81 Ford Mondeo 17780 7995 4 30000 1 82 Mazda Pegasus 10420 2495 7 50000 3 83 Rover 416i 14486 3685 6 64000 1 84 Vauxhall Corsa 7840 4976 4 21000 2 85 Vauxhall Corsa 7440 3495 6 55000 2 86 Ford Fiesta 6590 1664 10 37000

  1. Design an investigation to see if there is a significant relationship between the number ...

    However, a line transect would avoid these gullies. Secondly, systematic sampling appealed to me above random sampling, due to the time restrictions imposed on me on the day of execution. The tide is known to move in very quickly due to the shelved nature of the bay, so I feel there would not be time to map out

  2. I want to find out if there is a connection between people's IQ and ...

    Now I will calculate my Spearmans. =CORREL(L12:L61,M12:M61) My Spearmans Rank for my sample was 0.88. This again shows that my correlation is positive and very strong as 0.88 is very close to 1 on the scale. These calculations both mean that my data is really close together, and that the

  1. house prices and sales

    I would also find the inter quartile range for the results to compare them further by removing the freak results.

  2. An Investigation Into An Aspect Of Human Variation.

    There is a distinct peak at a hand span measurement of 21.5-22.5cm and distinctly lower frequencies at the extreme values. Appendix 9-Graph 8 is a frequency distribution graph illustrating the total data obtained for foot length measurements. It shows a wide variation of measurements and contains two peaks.

  1. One basic assumption of Black-Scholes model is that the stock price is log-normally distributed ...

    We chose Feb 19th as the big event date for the company, because there was a takeover bid from the management of Pizza Express on that day. The share price of Six Continents jumped more than 10% on Feb 19th and the trading volume increased more than 200%.

  2. Mating choice and Lonely Hearts Columns.

    This investigation aimed to shine light upon whether males and females requested and offered similarly, differently, or equally in relation to mating-choices. HYPOTHESIS There were 3 hypotheses in which my investigation intended to explore. These were: > Females request 'financial resources' more than males, where as males offer it more than females.

  • Over 160,000 pieces
    of student written work
  • Annotated by
    experienced teachers
  • Ideas and feedback to
    improve your own work