Many investors and financial analysts believe the Dow Jones Industrial Average (DJIA) gives a good
barometer of the overall stock market. On January 31, 2006, 9 of the 30 stocks making up the DJIA
increased in price (The Wall Street Journal, February 1, 2006). On the basis of this fact, a financial analyst
claims we can assume that 30% of the stocks traded on the New York Stock Exchange (NYSE) went up the
same day.
A sample of 72 stocks traded on the NYSE that day showed that 32 went up.
You are conducting a study to see if the proportion of stocks that went up is significantly more than 0.3.
You use a significance level of a=0.01.
What is the test statistic for this sample? (Report answer accurate to three decimal places.)
test statistic-
What is the p-value for this sample? (Report answer accurate to four decimal places.)
p-value-
The p-value is...
O less than (or equal to) a
O greater than a
This test statistic leads to a decision to...
O reject the null
O accept the null
O fail to reject thnull
As such, the final conclusion is that....
O There is sufficient evidence to warrant rejection of the claim that the proportion of stocks that went
up is more than 0.3.
O There is not sufficient evidence to warrant rejection of the claim that the proportion of stocks that
went up is more than 0.3.
O The sample data support the claim that the proportion of stocks that went up is more than 0.3.
O There is not sufficient sample evidence to support the claim that the proportion of stocks that went
up is more than 0.3.