February 23, 2018 MATH 433/533 – Exam 1 Name: Hattie Burford

TAKE HOME PART

50 points

1. An investor believes that although the price of stock 1 usually exceeds that of stock 2, stock 1
represents a riskier investment, where the risk of a given stock is measured by the variation in
daily price changes. Suppose we obtain a random sample of 8 daily price changes for stock 1
and 8 for stock 2. The sample results are summarized in the table below. Compare the risks
associated with the two stocks by testing the null hypothesis that the variances of the price
changes for the stocks are equal against the alternative hypothesis that the price variance for
stock 1 is different than that of stock 2.
Stock 1 n1 = 8 1 = 0.210 S1 = 1.73
Stock 2 n2 = 8 2 = 0.175 S2 = 1.46

Consider the preliminary F-test for testing the equality of population variances (test of
homogeneity):

Ho: σ21 = σ22 Ha: σ21 ≠ σ22

Let α = 0.05.

a. Calculate the test statistic F'. Give the Critical Region.

′
𝑺𝟏 𝟐 𝟏. 𝟕𝟑 𝟐
𝑭 =( ) =( ) ≈ 𝟏. 𝟒𝟎𝟒𝟎𝟔𝟐
𝑺𝟐 𝟏. 𝟒𝟔

Using table 8 alpha=.05, two tailed, df1=7, df2=7:

𝟏
𝑪𝑹: 𝑭′ ≤ 𝒐𝒓 𝑭′ ≥ 𝟒. 𝟗𝟗
𝟒. 𝟗𝟗
𝑭′ ≤ 𝟎. 𝟐𝟎𝟎𝟒 𝒐𝒓 𝑭′ ≥ 𝟒. 𝟗𝟗

Therefore, since the test statistic, F’, does not lie in either CR, we would fail to reject Ho.

b. Find the P-value.

𝑭𝒄𝒅𝒇(𝑭′ , 𝑬𝟗𝟗, 𝒅𝒇𝟏, 𝒅𝒇𝟐)

𝑭𝒄𝒅𝒇(𝟏. 𝟒𝟎𝟒𝟎𝟔𝟐𝟕, 𝑬𝟗𝟗, 𝟕, 𝟕) ∗ 𝟐 =. 𝟔𝟔𝟓𝟓6

.66556<. 𝟎𝟓

Therefore, we fail to reject Ho.

 c. Make a decision about Ho.

Since our F’ did not lie in either CR, and our p-value was not less than alpha, we fail to
reject the null hypothesis. Therefore, the variances of the price changes for the stocks are
statistically equal.

2. An experiment is conducted to compare the starting salaries of male and female college
graduates who find jobs. Pairs are formed by choosing a male and a female with the same
major and similar GPA. Suppose a random sample of 15 pairs is formed in this manner and the
starting annual salary of each person is recorded (see table).
Pair 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
Male 29,300 31,500 30,400 28,500 33,500 27,800 29,500 31,200 28,400 29,200 30,000 27,900 34,000 28,300 30,500
Female 29,000 31,600 29,800 28,500 32,600 28,000 29,200 30,100 28,200 28,500 29,400 28,200 34,300 27,900 30,200

a. Using the Ho: Differences are symmetric about 0 vs. Ha: Differences tend to be larger
than 0, conduct the Wilcoxon signed-rank test for the above data and find the test
statistic.

𝒅𝒊 = 𝒎𝒂𝒍𝒆 − 𝒇𝒆𝒎𝒂𝒍𝒆
𝒅𝒐 = 𝟎
𝑻 = 𝒎𝒊𝒏{|𝑻 − |, 𝑻+}

Thus, |𝑻 − | = 𝟏𝟓. 𝟓, 𝑻+= 𝟖𝟗. 𝟓, 𝒕𝒉𝒆𝒓𝒆𝒇𝒐𝒓𝒆 𝑻 = 𝟏𝟓. 𝟓

b. alpha = 0.05, determine the critical region.

𝑻 ≤ 𝟐𝟓 𝒘𝒉𝒆𝒏 𝒏 = 𝟏𝟒 𝒂𝒏𝒅 𝒂𝒍𝒑𝒉𝒂 =. 𝟎𝟓, 𝒐𝒏𝒆 − 𝒔𝒊𝒅𝒆𝒅
Since 15.5< 𝟐𝟓 we reject Ho.

c. Even though n < 50, run the approximate z-test. Find the test statistic, the critical region,
and the p-value. Then make a decision.
𝟏𝟒 (𝟏𝟓)
𝝁𝑻 = = 𝟓𝟐. 𝟓 𝑻 = 𝟏𝟓. 𝟓 𝒕𝒋 = 𝟑
𝟒

𝟏 𝟏
𝝈𝟐𝑻 = ((𝟏𝟒)(𝟏𝟓)(𝟐𝟗)) − (∑(𝟐)(𝟏)(𝟑) + (𝟓)(𝟒)(𝟔) + (𝟐)(𝟏)(𝟑) ))
𝟐𝟒 𝟐
𝟏 𝟏 𝟏
𝝈𝟐𝑻 = 𝟐𝟒 (𝟔𝟎𝟗𝟎 − 𝟐 (𝟏𝟑𝟐)) = 𝟐𝟒 (𝟔𝟎𝟐𝟒) = 𝟐𝟓𝟏

𝝈𝑻 = 𝟏𝟓. 𝟖𝟒𝟐𝟗𝟖
 𝑻 − 𝝁𝑻 𝟏𝟓. 𝟓 − 𝟓𝟐. 𝟓
𝒛′ = = = −𝟐. 𝟑𝟑𝟓𝟒
𝝈𝑻 𝟏𝟓. 𝟖𝟒𝟐𝟗𝟖

Therefore, using 𝜶 = 𝟎. 𝟎𝟓, our 𝑪𝑹: 𝒁 ≤ −𝟏. 𝟔𝟒𝟓

Since our z test statistic lies in the CR, we reject Ho.

𝒏𝒐𝒓𝒎𝒂𝒍𝒄𝒅𝒇(−𝑬𝟗𝟗, −𝟐. 𝟑𝟑𝟓𝟒) ≈. 𝟎𝟎𝟗𝟕𝟔

Since our p-value is less than alpha, we reject Ho.

3. In a comparison of visual acuity of deaf and hearing children, eye movement rates are taken
on 9 deaf and 9 hearing children. A clinical psychologist believes that deaf children have greater
visual acuity than hearing children. Test the psychologist's claim by using the data in the table.
(The larger a child's eye movement rate, the more visual acuity the child possesses.) Let α =
0.05.
Deaf children 2.45 3.14 3.23 2.30 2.64 1.95 2.17 2.45 1.75

Hearing children 1.15 1.65 1.43 1.73 1.75 1.33 2.03 1.64 1.95

Ho: The visual acuity of the two groups is identical.

Ha: The visual acuity of the deaf children is greater than the visual acuity of the hearing
children.

a. Rank the combined data and calculate the Wilcoxon test statistic T. This is a rank sum test.

TOTAL
Deaf
2.45 3.14 3.23 2.3 2.64 1.95 2.17 2.45 1.75
children
Rank 14.5 17 18 13 16 9.5 12 14.5 7.5 122
Hearing
1.15 1.65 1.43 1.73 1.75 1.33 2.03 1.64 1.95
children
Rank 1 5 3 6 7.5 2 11 4 9.5 49

Since our Ha = The visual acuity of the deaf children is greater than the visual acuity of the
hearing children, we use 𝑻𝒖 = 𝟏𝟐𝟐

b. Specify the critical region and make a decision about Ho.

Using Table 5, alpha=.05, and a one tailed test:

𝒏𝟏 = 𝒏𝟐 = 𝟗
𝑻 = 𝟏𝟐𝟐 ≥ 𝑻𝑼 = 𝟏𝟎𝟓
𝑻𝒉𝒆𝒓𝒆𝒇𝒐𝒓𝒆, 𝒘𝒆 𝒓𝒆𝒋𝒆𝒄𝒕 𝑯𝒐.
 c. Even though the samples sizes do not exceed 10, conduct the approximate z-test. Use the
formula that ignores the ties. Find the test statistic, the p-value and make a decision. Let
alpha = 0.05.

𝑻−𝝁𝑻
𝒛′ = 𝑻 = 𝟏𝟐𝟐
𝝈𝑻

𝟗(𝟗 + 𝟗 + 𝟏)
𝝁𝑻 = = 𝟖𝟓. 𝟓
𝟐

𝟗(𝟗)
𝝈𝟐𝑻 = (𝟗 + 𝟗 + 𝟏) = 𝟏𝟐𝟖. 𝟐𝟓
𝟏𝟐

𝝈𝑻 = 𝟏𝟏. 𝟑𝟐𝟒𝟖

𝟏𝟐𝟐 − 𝟖𝟓. 𝟓
𝒛′ = ≈ 𝟑. 𝟐𝟐𝟑𝟎𝟏
𝟏𝟏. 𝟑𝟐𝟒𝟖

Our CR: 𝒁 ≥ 𝟏. 𝟔𝟒𝟓

Therefore, since our test statistic falls in the CR, we reject Ho.

𝒏𝒐𝒓𝒎𝒂𝒍𝒄𝒅𝒇(𝟑. 𝟐𝟐𝟑𝟎𝟏, 𝑬𝟗𝟗) ≈ 𝟔. 𝟑𝟒𝟑𝟐𝑬 − 𝟒 ≈ 𝟎

Therefore, we reject Ho.

4. Are couch potatoes (people who watch a lot of television) experts in sports? A survey was
conducted to determine whether a person is an expert in a sport merely by watching a lot of it
on television. Thus, the question is: Does watching a lot of sports on television mean that one
is an expert in that/those sport(s)? Here is a table of the gathered information. To qualify as an
expert in sports, a sports knowledge exam was given to all participants.

Expert in sports Not an expert in sports

Couch potato 56 37
Not a couch potato 46 61

a. The hypotheses are as follows:

Ho: Sports expertise and watching a lot a television are independent variables

Ha: Sports expertise and watching a lot a television are dependent variables

Conduct the test for independence at the alpha = 0.05 level of significance. Calculate the test
statistic and the p-value. Find the Expected Values for each cell in the table. Make a decision.
 Expected Values
Not an Not an
Expert Expert
expert expert
in in
in in
sports Totals sports
sports sports
Couch Couch
56 37 47.43 45.57
potato 93 potato
Not a Not a
couch 46 61 couch 54.57 52.43
potato 107 potato
Totals 102 98 200

′
Using the 𝑿𝟐 𝒕𝒆𝒔𝒕:
𝑿𝟐′ ≈ 𝟓. 𝟗𝟎𝟔𝟖𝟖𝟔𝟗
p=.0150818
df=1
Using table 7:
df=1
CR: 𝑿𝟐′ ≥ 3.841

Since our 𝑿𝟐′ lies in the CR, we reject Ho.

Since our p-value is less than alpha, we reject Ho.

b. Conduct a two-proportion z-test, with alpha = 0.05. Determine the critical region for the
hypotheses:

Ho: 1   2 vs. Ha: 1   2 , (the proportion of couch potatoes who are experts in
sports is the same as the proportion of non-couch potatoes who are experts in sports)

Calculate the test statistic and p-value for this test. Make a decision.

x1=56
n1=93
x2=46
n2=107

Using the 2-Prop Z-Test:

z’=2.43041
p=.0150818

CR: 𝒁 ≤ −𝟏. 𝟗𝟔 𝒐𝒓 𝒁 ≥ 𝟏. 𝟗𝟔
Since our test statistic lies in the CR, we reject Ho.

Therefore, the proportion of couch potatoes who are experts in sports is not the same as the
proportion of non-couch potatoes who are experts in sports.

5. The response variable is the golf score after practicing a certain number of hours before
playing a round (18 holes).

0 to 85 81 82 79 80 84 83
less
than 2
hours
2 76 78 81 77 80 76 74 80 81 78
hours
to less
than 4
hours
4 77 73 76 73 75 78 76 72
hours
or
more

a. Conduct the Hartley’s F-test. State your null and alternative hypotheses. Determine
your critical region. Let alpha = 0.05

Ho: σ²1 = σ²2 = σ²3

Ha: Population variances are not all equal

𝜶 =. 𝟎𝟓

𝒅𝒇𝟏 = 𝟑

𝒅𝒇𝟐 = 𝟏𝟎 − 𝟏 = 𝟗

𝑪𝑹: 𝑭 ≥ 𝟓. 𝟑𝟒

b. Find the test statistic and the p-value. Make a decision.

𝑺𝟐𝟏 =4.6667
𝑺𝟐𝟐 =5.6555
𝑺𝟐𝟑 =4.57143
 ′
𝑺𝒎𝒂𝒙𝟐 𝟓. 𝟔𝟓𝟓𝟓
𝑭 = ≈ ≈ 𝟏. 𝟐𝟑𝟕𝟏𝟒
𝑺𝒎𝒊𝒏𝟐 𝟒. 𝟓𝟕𝟏𝟒𝟑
Our test statistic does not fall in the CR, therefore, we fail to reject Ho.
𝑭𝒄𝒅𝒇(𝟏. 𝟐𝟑𝟕𝟏𝟒, 𝑬𝟗𝟗, 𝟑, 𝟗) ≈. 𝟑𝟓𝟐𝟐
Since our p-value is not less than alpha, we fail to reject Ho.

6. Using the same data set as in #5, conduct the Bartlett approximate chi-square test. Alpha =
0.05

a. Find the test statistic. Show all work for the formulas.

Using ANOVA, I found my MS=5.0409

𝟏 𝟏 𝟏 𝟏 𝟏 𝟏 𝟏 𝟏
𝑪=𝟏+ [∑ ( )−( )] = 𝟏 + [( + + ) − ( )] ≈ 𝟏. 𝟎𝟔𝟐𝟓𝟑
𝟑(𝒕 − 𝟏) 𝒏𝒊 − 𝟏 𝒏𝑻 − 𝒕 𝟑(𝟑 − 𝟏) 𝟔 𝟗 𝟕 𝟐𝟓 − 𝟑

𝟏
𝝌𝟐 = [(𝒏𝑻 − 𝒕)𝒍𝒏𝑴𝑺𝑬 − ∑(𝒏𝒊 − 𝟏)𝒍𝒏(𝒔𝟐𝒊 )]
𝒄
𝟏
= (𝟐𝟐𝒍𝒏(𝟓. 𝟎𝟒𝟎𝟗) − (𝟔𝒍𝒏𝟒. 𝟔𝟔𝟔𝟕 + 𝟗𝒍𝒏𝟓. 𝟔𝟓𝟓𝟓 + 𝟕𝒍𝒏𝟒. 𝟓𝟕𝟏𝟒𝟑)) ≈. 𝟏𝟎𝟓𝟏𝟑𝟓𝟔
𝟏. 𝟎𝟔𝟐𝟓𝟑

df=t-1=2

CR: 𝝌𝟐 ≥ 𝟓. 𝟗𝟗𝟏

Since our test statistic does not lie in the CR, we fail to reject.

b. Find the p-value and make a decision

′
p-value: 𝝌𝟐 𝒄𝒅𝒇(𝝌𝟐 , 𝑬𝟗𝟗, 𝒅𝒇) = 𝝌𝟐 𝒄𝒅𝒇(. 𝟏𝟎𝟓𝟏𝟑𝟓𝟔, 𝑬𝟗𝟗, 𝟐) ≈. 𝟗𝟒𝟖𝟖

Since our p-value is not less than alpha, we fail to reject Ho.