The information below presents the summary statistics for the starting annual sa

Question

The information below presents the summary statistics for the starting annual salaries (in thousands of dollars) for individuals entering the public accounting and financial planning professions. Sample 1 (public accounting): S1 = 3.25, n1 = 12 Sample 2 (financial planning): S2 = 2.48, n2 = 14 Note that "n" is sample size, and "s" is sample standard deviation. We wish to determine if the population variances are equal based on the sample data. Assume that the critical value for F is 4.22 (i.e., F_crit = 4.22). Referring to Scenario 4, we can conclude that: the two population variances are equal. the two population means differ. the two population variances differ. the two population means are the same.

Explanation / Answer

H0: 12/22 = 1

H1: 12/22 1

F = s12/s22 = 3.252/2.482 = 1.717 (F = s12/s22 where s12 is the larger of the 2)

Since F < Fcrit, the variances of public and financial planning are not different

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