Many investors and financial analysts believe the Dow Jones Industrial Average (
ID: 3047699 • Letter: M
Question
Many investors and financial analysts believe the Dow Jones Industrial Average (DJIA) gives a good barometer of the overall stock market. On January 31, 2006, 9 of the 30 stocks making up the DJIA increased in price (The Wall Street Journal, February 1, 2006). On the basis of this fact, a financial analyst claims we can assume that 30% of the stocks traded on the New York Stock Exchange (NYSE) went up the same day.
A sample of 64 stocks traded on the NYSE that day showed that 22 went up.
You are conducting a study to see if the proportion of stocks that went up is is significantly more than 0.3. You use a significance level of =0.10=0.10.
What is the test statistic for this sample? (Report answer accurate to three decimal places.)
test statistic =
What is the p-value for this sample? (Report answer accurate to four decimal places.)
p-value =
Explanation / Answer
The statistical software output for this problem is:
One sample proportion summary hypothesis test:
p : Proportion of successes
H0 : p = 0.3
HA : p > 0.3
Hypothesis test results:
Hence,
Test statistic = 0.764
P - value = 0.2225
Proportion Count Total Sample Prop. Std. Err. Z-Stat P-value p 22 64 0.34375 0.057282196 0.76376262 0.2225Related Questions
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