An insurance company is reviewing its current policy rates. When originally setting the rates they believed that the average claim amount was $1,800. Now there are concerns that if the true mean is actually higher than this they could potentially lose a lot of money. They randomly select 40 claims, and calculate a sample mean of $1,950. Assuming that the standard deviation of claims is $500, and set significance level = :05, test to see if the insurance company should be concerned.