Wall Street traders are anxiously waiting for the federal government’s release of the August numbers for...

Wall Street traders are anxiously waiting for the federal government’s release of the August numbers for nonfarm payrolls. Last year month of August showed an average of 120,000 new jobs with a standard deviation of 20,000. A sample of 100 nonfarm payrolls taken earlier in the week shows a sample mean of 117,000. Financial analysts often call such a sample mean the “whisper number”. Conduct a hypothesis test to determine whether the whisper number justifies a conclusion of a statistically significant change in the number of new jobs with respect to last year. Allow for 5% error in the test. The hypothesis setting for the test follows. H0 : µ = 120,000 Ha : µ ≠ 120,000 a. (5pt) Conduct hypothesis test using a critical-value approach. b. (3pt) Conduct a hypothesis test using a p-value approach. c. (3pt) According to the statistical analysis you have performed above, do you think the whisper number does justify a conclusion of a statistically significant change in the number of new jobs? WHY?

Expert Solution

So,we can say that there is sufficient evidence to support the claim that there is significant change in the number of new jobs.

orchestra answered 1 year ago

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