Letxbe a random variable representing dividend yield of German bank stocks. We assume thatxhas a normal distribution with average = 4.7% with SD = 2.4%. My random sample of 64 dividend yields of German bank stocks from the South of Germany had an average of 5.4%. Test if my sample of German bank stocks from the South are statistically different from the rest of Germany.

For this test use the critical value of

=1.96

zc=1.96and

= 0.05. Determine the null and alternative hypothesis. What is the result of the test?

Answers:

We can reject the null hypothesis at the =0.05 level.

We cannot reject the null hypothesis at the =0.05 level.

We can reject the alternative hypothesis at the =0.05 level.

We cannot reject the alternative hypothesis at the =0.05 level.