Question

In: Statistics and Probability

Many investors and financial analysts believe the Dow Jones Industrial Average (DJIA) gives a good barometer...

Many investors and financial analysts believe the Dow Jones Industrial Average (DJIA) gives a good barometer of the overall stock market. On January 31, 2006, 9 of the 30 stocks making up the DJIA increased in price (The Wall Street Journal, February 1, 2006). On the basis of this fact, a financial analyst claims we can assume that 30% of the stocks traded on the New York Stock Exchange (NYSE) went up the same day.

A sample of 57 stocks traded on the NYSE that day showed that 28 went up.

You are conducting a study to see if the proportion of stocks that went up is is significantly more than 0.3. You use a significance level of α=0.10α=0.10.

What is the test statistic for this sample? (Report answer accurate to three decimal places.)
test statistic =___________

What is the p-value for this sample? (Report answer accurate to four decimal places.)
p-value = ___________

Please show me step by step how you got the P-vaule!!!!!!

Solutions

Expert Solution

Solution :

=> Test statistic z = 3.150

=> P-value = 0.0008


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