Comparison of 2 population variances. An important measure of the risk associate
ID: 3438125 • Letter: C
Question
Comparison of 2 population variances. An important measure of the risk associated with a stock is the standard deviation, or variance, of the stock's price movement. To test whether Intel is riskier than Microsoft, you obtain sample variances of both stocks. Your computed F statistic is 1.879. The critical value of this statistic at alpha = 0.01, is 2.80. How do you conclude?
Reject H0. Intel is riskier than Microsoft.
Do not reject H0. There is no evidence that Intel is riskier than Microsoft.
Reject H0. Microsoft is not riskier than Intel.
Do not reject H0. Microsoft is riskier than Intel.
None of the above conclusions is correct.
Reject H0. Intel is riskier than Microsoft.
Do not reject H0. There is no evidence that Intel is riskier than Microsoft.
Reject H0. Microsoft is not riskier than Intel.
Do not reject H0. Microsoft is riskier than Intel.
None of the above conclusions is correct.
Explanation / Answer
Comparison of 2 population variances. An important measure of the risk associated with a stock is the standard deviation, or variance, of the stock's price movement. To test whether Intel is riskier than Microsoft, you obtain sample variances of both stocks. Your computed F statistic is 1.879. The critical value of this statistic at alpha = 0.01, is 2.80. How do you conclude?
Reject H0. Intel is riskier than Microsoft.
Do not reject H0. There is no evidence that Intel is riskier than Microsoft.
Reject H0. Microsoft is not riskier than Intel.
Do not reject H0. Microsoft is riskier than Intel.
None of the above conclusions is correct.
Computed F statistic is 1.879. < than the critical value of this statistic at alpha = 0.01, is 2.80.
The null hypothesis is not rejected.
Do not reject H0. There is no evidence that Intel is riskier than Microsoft
Reject H0. Intel is riskier than Microsoft.
Do not reject H0. There is no evidence that Intel is riskier than Microsoft.
Reject H0. Microsoft is not riskier than Intel.
Do not reject H0. Microsoft is riskier than Intel.
None of the above conclusions is correct.
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