Question

1. Create the printout for testing whether the mean low stock price of all NYSE stocks differs from $35 and attach it here. Answer the following questions regarding this printout:

Student Edition of Statistix 10.0                          4/20/2020, 6:48:59 PM

One-Sample T Test

Null Hypothesis: μ = 35

Alternative Hyp: μ ≠ 35

                                                         Lower       Upper

Variable     Mean       SE       T    DF        P    95% C.I.   95% C.I.

Low        45.120   9.9629   1.02   39   0.3160     24.968     65.272

Cases Included 40    Missing Cases 0

1. In the words of the problem, give a practical conclusion for this test. Make sure to include your choice of α in this conclusion.
2. In the words of the problem, state what a Type I error would be.
3. Use your knowledge of p-values and the printout above to state what the p-value would have been if you were conducting a one-tailed test instead of the two-tailed test I asked for.

Answer 1

Null Hypothesis: μ = 35

Alternative Hyp: μ ≠ 35

P value = 0.3160

Let assume α = 0.05

As P value is greater than 0.05, we fail to reject H0, we do not have significant evidence to support the claim.

a) Conclusion : The mean low stock price of all NYSE stocks do not differs from $35

b) Type I error would be occur if we conclude that the mean low stock price of all NYSE stocks differs from $35, but in reality it is equal to $35

c) We are given P value for two tailed test is 0.3160, so to find the P value for one tail we have to divide 0.3160 by 2

So P value for one tail test is 0.1580