Question

4. Using the entire data set of 65 stocks, count up the number of stocks in your data that have a high stock price that is at least $20. State this value here: 33.

Student Edition of Statistix 10.0                          4/21/2020, 5:36:23 AM

Stem and Leaf Plot of High

Leaf Digit Unit = 10                     Minimum 1.2000

3 8 represents 380                        Median   23.270

                                                      Maximum 385.51

Depth        Stem          Leaves

(50)             0             00000000000111111111111111111111222222222333444444

   15              0             566677789

    6               1             3

    5               1             67

    3               2             00

    1               2            

    1               3            

    1               3             8

65 cases included   0 missing cases  

1. 1. Suppose it is desired to determine if the true percentage of all stocks that have high prices that are at least $20 differs from 40%. Is the sample size large enough to conduct this test? Why or why not? Show your calculations for full credit!
2. 2. Use the table on the next page to locate the number of your stocks with high prices of at least $20 in your sample. Use the table to locate the Test Statistic that you should use for this test and write it here:

Test Statistic: 1.77

c. Give the rejection region for this test (you choose an acceptable level for a).

d. In the words of the problem, give a practical conclusion for this test. Make sur to include your choice of α in this conclusion.

Answer 1

a. Yes, here the sample size is 65(>30) large enough to conduct this test.

b. The photo of this answer is pasted as (a)

c. The rejection region is |z|>=1.96 shown in the diagram at α = 5% i.e., 5% level of significance(l.s.).

d. At 5% level of significance we dont have sufficient evidence to reject the Null Hupothesis "the true percentage of stocks that have high prices that are at least $ 20 is 40%".