An online stock trading company makes part of their revenue from clients when th

Question

An online stock trading company makes part of their revenue from clients when the clients trade stocks therefore, it is important to the company to have an good idea of how many trades its clients are making in a given year. In a sample of 98 clients of an online stock trading company, the average number of trades per yera was 85 with a standard deviation of 17. If you were to test the hypothesis that the average number of trades per year is greater than the previous year when the average number of trades was 84 (using the 10% level of significance), what is the critical value? (please round your answer to 2 decimal places)

Explanation / Answer

Solution:

The degree of freedom will be given by,

df = n -1 = 98 - 1 = 97

The critical value will be the value of 't' for 97 degrees of freedom and 0.90 cumulative probability which is 1.29

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