# Question: At the end of 2008 the variance in the semiannual

At the end of 2008, the variance in the semiannual yields of overseas government bond was σ2 = .70. A group of bond investors met at that time to discuss future trends in overseas bond yields. Some expected the variability in overseas bond yields to increase and others took the opposite view. The following table shows the semiannual yields for 12 overseas countries as of March 6, 2009 (Barron's, March 9, 2009).

a. Compute the mean, variance, and standard deviation of the overseas bond yields as of March 6, 2009.

b. Develop hypotheses to test whether the sample data indicate that the variance in bond yields has changed from that at the end of 2008.

c. Use α = .05 to conduct the hypothesis test formulated in part (b). What is your conclusion?

a. Compute the mean, variance, and standard deviation of the overseas bond yields as of March 6, 2009.

b. Develop hypotheses to test whether the sample data indicate that the variance in bond yields has changed from that at the end of 2008.

c. Use α = .05 to conduct the hypothesis test formulated in part (b). What is your conclusion?

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