Question

In: Statistics and Probability

(Round all intermediate calculations to at least 4 decimal places.) A financial analyst maintains that the...

(Round all intermediate calculations to at least 4 decimal places.)

A financial analyst maintains that the risk, measured by the variance, of investing in emerging markets is more than 256(%)2. Data on 44 stocks from emerging markets revealed the following sample results: x¯x¯ = 20.6(%) and s2 = 352(%)2. Assume that the returns are normally distributed. Use Table 3.

   

a. Select the competing hypotheses to test the analyst's claim.
H0: σ2 ≤ 256; HA: σ2 > 256
H0: σ2 = 256; HA: σ2 ≠ 256
H0: σ2 ≥ 256; HA: σ2 < 256

b.

 At α = 0.10 specify the critical value. (Round your answer to 3 decimal places.)
  Critical value   

c.

What is the value of the test statistic? (Round your answer to 2 decimal places.)
  Test statistic   

  

d.

 Is the financial analyst's claim supported by the data?
Yes, since the value of the test statistic is less than the critical value.
Yes, since the value of the test statistic is more than the critical value.
No, since the value of the test statistic is less than the critical value.
No, since the value of the test statistic is more than the critical value.

Solutions

Expert Solution


orchestra answered 2 years ago
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