Question

You sampled 200 Twitter stock prices. Suppose that you found the sample mean stock price to be c = $30:00 with a standard deviation of sc = $12:50

. (a) Suppose that a stock exchange has claimed that the true mean Twitter stock price is only $28. To test this claim, perform a hypothesis test at the α = 0:02 significance level to determine whether the sample provides evidence that the true mean Twitter stock price differs from the stock exchange's claim of $28. Be sure to state the null and alternate hypotheses and show your calculations of the test statistic (to 2 decimals) and p-value

. Null Hypothesis H0: _________

Alternate Hypothesis Ha:________

Observed test statistic:_________

p-value:__________

Conclusion: ________

Concluding Statement: _______

(b) For what levels of significance would the sample have provided evidence against the null hypothesis in part (a)?

(c) Construct a 98% confidence interval for the true mean Twitter stock price. Be sure to include units in your answer and make a concluding statement.

(d) Instead of using the "p-value" in part (a), could we have used the confidence interval in part (c) to test the null hypothesis? Explain why it could or could not be used and, if it could be used, how you would come to the same conclusion as in part (a).

(f) It was shown in Lab Report 3 that the true mean Twitter stock price was μ = $30:40 with a standard deviation of σ = $12:69: For a random sample of size n = 200; determine the probability (to 4 decimal places) of a type II error occurring in the test in part (a).

Answer 1