Let x be a random variable representing dividend yield of bank stocks. We may as

Question

Let x be a random variable representing dividend yield of bank stocks. We may assume that x has a normal distribution with = 2.7%. A random sample of 10 bank stocks gave the following yields (in percents).

The sample mean is x = 5.38%. Suppose that for the entire stock market, the mean dividend yield is = 4.7%. Do these data indicate that the dividend yield of all bank stocks is higher than 4.7%? Use = 0.01.

(a) What is the level of significance?

(b) What is the value of the sample test statistic? (Round your answer to two decimal places.)


(c) Find (or estimate) the P-value. (Round your answer to four decimal places.)


Sketch the sampling distribution and show the area corresponding to the P-value.

(d) Based on your answers in parts (a) to (c), will you reject or fail to reject the null hypothesis? Are the data statistically significant at level ?

Explanation / Answer

The sample mean is x = 5.38%. Suppose that for the entire stock market, the mean dividend yield is = 4.7%. Do these data indicate that the dividend yield of all bank stocks is higher than 4.7%? Use = 0.01.

(a) What is the level of significance?

alpha = 0.01

Ho : miu = 4.7 Ha : miu > 4.7

Z = ( 5.38 - 4.7 ) / ( 2.7 / srqt 10 )

Z = 0.80

p value : 0.2119

since p value is greater than significance level we fail to reject Ho

Related Questions

Navigate

• Browse (All)
• Browse L
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.