The given data:
[tex] n=26 \\\mu=0.6
\\ \sigma = 0.003
\\s=0.0026\\\alpha=0.10 [/tex]
Null Hypothesis: [tex] H_0: \sigma =0.003 [/tex]
Alternative Hypothesis: [tex] H_1: \sigma<0.003 [/tex]
Level of significance: [tex] \alpha=0.10 [/tex]
Test Statistics:
Using chi-square test,
[tex] \chi ^2=\frac{ns^2}{\sigma^2} [/tex]
[tex] \Rightarrow \chi ^2=\frac{26*0.0026^2}{0.003^2}=19.528 [/tex]
Number of degrees of freedom[tex] = n-1=26-1=25. [/tex]
Table value of [tex] \chi^2 [/tex] for 25 degrees of freedom at 10% level = 34.382.
Conclusion:
There is no significant evidence for the manager to conclude that the standard deviation has decreased.