A stock analyst wondered whether the mean rate of return of financial, energy, a
ID: 3056745 • Letter: A
Question
A stock analyst wondered whether the mean rate of return of financial, energy, and utility stocks differed over the past 5 years. He obtained a simple random sample of eight companies from each of the three sectors and obtained the 5-year rates of return shown in the accompanying table (in percent). Complete parts (a) through (d) below.
LOADING...
Click the icon to view the data table.
(a) State the null and alternative hypotheses. Choose the correct answer below.
A.
Upper H 0 : mu Subscript financial Baseline equals mu Subscript energy Baseline equals mu Subscript utilities
and Upper H 1 : at least one of the means is different
Your answer is correct.
B.
Upper H 0 : mu Subscript financial Baseline equals mu Subscript energy Baseline equals mu Subscript utilities
and Upper H 1 : mu Subscript financial Baseline less than mu Subscript energy Baseline less than mu Subscript utilities
C.
Upper H 0 : at least one of the means is different
and Upper H 1 : mu Subscript financial Baseline equals mu Subscript energy Baseline equals mu Subscript utilities
D.
Upper H 0 : mu Subscript financial Baseline equals mu Subscript energy
and Upper H 1 : the means are different
(b) Normal probability plots indicate that the sample data come from normal populations. Are the requirements to use the one-way ANOVA procedure satisfied?
A.
No, because the largest sample standard deviation is more than twice the smallest sample standard deviation.
B.
No, because there are
kequals
3
simple random samples, one from each of k populations, the k samples are independent of each other, and the populations are normally distributed and have the same variance.
C.
Yes, because there are
kequals
3
simple random samples, one from each of k populations, the k samples are independent of each other, and the populations are normally distributed and have different variances.
D.
Yes, because there are
kequals
3
simple random samples, one from each of k populations, the k samples are independent of each other, and the populations are normally distributed and have the same variance.Your answer is correct.
(c) Are the mean rates of return different at the
alpha
equals
0.05
level of significance?
Use technology to find the F-test statistic for this data set.
Upper F 0
equalsnothing(Round to two decimal places as needed.)
Financial
Energy
Utilities
10.73
12.72
11.88
15.12
13.91
5.86
17.21
6.33
13.46
5.07
11.19
9.90
19.59
18.79
3.95
8.21
20.73
3.44
10.38
9.60
7.11
6.75
17.40
15.70
Financial
Energy
Utilities
10.73
Explanation / Answer
(a) State the null and alternative hypotheses
Upper H0 : mu Subscript financial Baseline equals mu Subscript energy Baseline equals mu Subscript utilities
and Upper H1 : at least one of the means is different(option A is corect)
(b) Normal probability plots indicate that the sample data come from normal populations. Are the requirements to use the one-way ANOVA procedure satisfied?
Yes, because there are k equals 3simple random samples, one from each of k populations, the k samples are independent of each other, and the populations are normally distributed and have the same variance.(option D is correct)
(c) Are the mean rates of return different at the alpha equals 0.05 level of significance?
Use technology to find the F-test statistic for this data set. Upper F0 equals nothing
Fail to reject H0 there is not sufficent evidence to conclude that atleast one mean is different than the others
Financial Energy Utilitles 10.73 12.72 11.88 15.12 13.91 5.86 17.21 6.33 13.46 5.07 11.19 9.9 19.59 18.79 3.95 8.21 20.73 3.44 10.38 9.6 7.11 6.75 17.4 15.7Related Questions
drjack9650@gmail.com
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.