Introduction to Statistics - Assignment Example

Introduction to Statistics Fall Assignment 6: T-Tests Analyse each one of the three cases below according to the following steps: 1. What is the appropriate test to implement and why? 2. Set up the null and alternative hypotheses. 3. What is the rejection rule? 4. Test at a significance level of 0.05 and present Excel output (copy and paste in Word document) 5. What is the rejection decision? 6. What is the conclusion? Question 1 An investor compares the returns on car manufacturers and energy stocks.

He believes that energy stocks perform better. He recorded 2 random samples of 6 returns in each industry. The numbers are given below: Obs. Car manufacturers energy 1 11.5 9.4 2 8.2 17.1 3 3.5 17.4 4 6.2 7.1 5 7.5 22.4 6 9.2 10.1 What is the appropriate test to implement and why? Independent sample t-test, because we are comparing means of two unrelated groups. Set up the null and alternative hypotheses. HO: µcar = µenergy H1: µenergy > µcar What is the rejection rule?

If p ≤  reject H0, otherwise fail to reject H0 Test at a significance level of 0.05 and present Excel output (copy and paste in Word document)   Energy Car manufacturers Mean 13.91666667 7.683333333 Variance 35.13366667 7.373666667 Observations 6 6 Pooled Variance 21.25366667 Hypothesized Mean Difference 0 df 10 t Stat 2.341876813 P(T