Designing a Study Stock fund managers are investment professionals who decide which stocks should be part of a portfolio. In an article in the Wall Street Journal (“Not a Stock-Picker’s Market,” WSJ, January 25, 2014), the performance of stock fund managers was considered based on dispersion in the market. In the stock market, risk is measured by the standard deviation rate of return of stock (dispersion). When dispersion is low, then the rate of return of the stocks that make up the market are not as spread out. That is, the return on Company X is close to that of Y is close to that of Z, and so on. When dispersion is high, then the rate of return of stocks is more spread out; meaning some stocks outperform others by a substantial amount. Since 1991, the dispersion of stocks has been about 7.1%. In some years, the dispersion is higher (such as 2001 when dispersion was 10%), and in some years it is lower (such as 2013 when dispersion was 5%). So, in 2001, stock fund managers would argue, one needed to have more investment advice in order to identify the stock market winners, whereas in 2013, since dispersion was low, virtually all stocks ended up with returns near the mean, so investment advice was not as valuable.
e. Suppose this study was conducted and the data yielded a P-value of 0.083. Explain what this result suggests.

Take this quiz as you would take a quiz in class. After you are done, check your work against the answers given in the back of the book.For each exercise, perform the steps below.

c. Find the critical value(s) and identify the rejection region(s).

The mean score on a reading assessment test for 49 randomly selected male high school students was 279. Assume the population standard deviation is 41. The mean score on the same test for 50 randomly selected female high school students was 292. Assume the population standard deviation is 39. At α=0.05, can you support the claim that the mean score on the reading assessment test for male high school students is less than the mean score for female high school students? (Adapted from National Center for Education Statistics)

Take this quiz as you would take a quiz in class. After you are done, check your work against the answers given in the back of the book.For each exercise, perform the steps below.

f. Interpret the decision in the context of the original claim.

The mean score on a reading assessment test for 49 randomly selected male high school students was 279. Assume the population standard deviation is 41. The mean score on the same test for 50 randomly selected female high school students was 292. Assume the population standard deviation is 39. At α=0.05, can you support the claim that the mean score on the reading assessment test for male high school students is less than the mean score for female high school students? (Adapted from National Center for Education Statistics)

In Exercises 5–8, test the claim about the difference between two population means μ1 and μ2 at the level of significance α. Assume the samples are random and independent, and the populations are normally distributed.

Claim: μ1=μ2; α=0.01

Population statistics: σ1= 52 and σ2= 68

Sample statistics: x̅1 = 5595, n1 = 156, and x̅2= 5575, n2= 216

In Exercises 5–8, test the claim about the difference between two population means μ1 and μ2 at the level of significance α. Assume the samples are random and independent, and the populations are normally distributed.

Claim: μ1<μ2; α=0.10

Population statistics: σ1= 0.11 and σ2= 0.10

Sample statistics: x̅1 = 0.28, n1 = 41, and x̅2= 0.33, n2= 34

In Exercises 5–8, test the claim about the difference between two population means μ1 and μ2 at the level of significance α. Assume the samples are random and independent, and the populations are normally distributed.

Claim: μ1≠μ2; α=0.05

Population statistics: σ1= 14 and σ2= 15

Sample statistics: x̅1 = 87, n1 = 410, and x̅2= 85, n2= 340

For ${\bar{x}}_1=40,{\sigma }_1=8.3,n_1=40,{\bar{x}}_2=39,{\sigma }_2=5.8$, & $n_2=50$, perform a hypothesis test to test the claim that ${\mu }_1>{\mu }_2$ for $\alpha =0.05$.

In Exercises 11–14, test the claim about the difference between two population means and at the level of significance . Assume the samples are random and independent, and the populations are normally distributed.

Claim: μ1=μ2; α=0.1

Population statistics:σ1=3.4 and σ2=1.5

Sample Statistics: x̅1=16, n1=29, x̅2=14, n2=28

In Exercises 11–14, test the claim about the difference between two population means and at the level of significance . Assume the samples are random and independent, and the populations are normally distributed.

Claim: μ1>μ2; α=0.10

Population statistics:σ1=40 and σ2=15

Sample Statistics: x̅1=500, n1=100, x̅2=495, n2=75