An economist wants to determine whether the Price/Earnings (P/E) ratio is the same for firms in three
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An economist wants to determine whether the Price/Earnings (P/E) ratio is the same for firms in three industries. Five firms were randomly selected from each industry. Their P/E ratios are shown in the accompanying table.
a. Specify the competing hypotheses to test whether some median P/E ratios differ by industry.
b. Calculate the value of the test statistic H.
c. At the 5% significance level, what is the critical value?
d. Do some P/E ratios differ by industry? Explain.
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Related Book For
Business Statistics Communicating With Numbers
ISBN: 9780078020551
2nd Edition
Authors: Sanjiv Jaggia, Alison Kelly
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