Exercise 1:

Companies often need to use Downsizing (laying off employees), in an attempt to reduce costs. The following table shows the number of layoffs in a sample of employees of three different sectors of employment, together with the work experience of the employees that got fired.

Sector of employment

Work experience A B C

Less than 6 months 13 30 15

6 months to 5 years 15 11 10

More than 5 years 10 9 4

Test if the sector of employment is generally independent of work experience of employees that are laid off. Use a 5% level of significance.