Suppose a mutual fund qualifies as having moderate risk if the standard deviatio

Question

Suppose a mutual fund qualifies as having moderate risk if the standard deviation of its mnthly rate f return is less than 3%. A mutual fund rating agency randomly selects 25 months and determines the rate of return for a certain fund. The standard deviation of the rate of return is computed to be 2.59%. Is there sufficient evidence to conclude that the fund has moderate risk at the alpha = 0.05 level of significance? A normal probability plot indicates that the monthly rates of return are normally distributed. What are the correct hypothesis is H_0: The alternative hypothesis is H_1:

Explanation / Answer

Ho : Sigma = 3%

Ha : Sigma < 3%

Related Questions

Navigate

• Browse (All)
• Browse S
• Subjects

---

---

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