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Assume that stock fund expenses and municipal bond fund expenses are each approximately normally distributed with equal population variances. Suppose that a random sample of 25 stock funds gives a mean annual expense of 1.15 percent with a standard deviation of 0.31 percent, and that an independent random sample of 25 municipal bond funds finds a mean annual expense of 0.35 percent with a standard deviation of 0.15 percent. Assume that the population standard deviations of expenses are the same for the two types of funds.

Assume that stock fund expenses and municipal bond fund expenses are each approximately normally distributed with equal population variances. Suppose that a random sample of 25 stock funds gives a mean annual expense of 1.15 percent with a standard deviation of 0.31 percent, and that an independent random sample of 25 municipal bond funds finds a mean annual expense of 0.35 percent with a standard deviation of 0.15 percent. Assume that the population standard deviations of expenses are the same for the two types of funds.

Calculus For The Life Sciences
Calculus For The Life Sciences
2nd Edition
ISBN:9780321964038
Author:GREENWELL, Raymond N., RITCHEY, Nathan P., Lial, Margaret L.
Publisher:GREENWELL, Raymond N., RITCHEY, Nathan P., Lial, Margaret L.
Chapter13: Probability And Calculus
Section13.3: Special Probability Density Functions
Problem 30E
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1. Assume that stock fund expenses and municipal bond fund expenses are each approximately normally distributed with equal population variances. Suppose that a random sample of 25 stock funds gives a mean annual expense of 1.15 percent with a standard deviation of 0.31 percent, and that an independent random sample of 25 municipal bond funds finds a mean annual expense of 0.35 percent with a standard deviation of 0.15 percent. Assume that the population standard deviations of expenses are the same for the two types of funds.

 

Establish a 95% confidence interval to estimate the difference in the population means between the stock and municipal bond funds. Test Ho: 41 – uz s 0.50 against Ha: µ1 – µ2 > 0.50 at the 5% level of significance.
Transcribed Image Text:Establish a 95% confidence interval to estimate the difference in the population means between the stock and municipal bond funds. Test Ho: 41 – uz s 0.50 against Ha: µ1 – µ2 > 0.50 at the 5% level of significance.
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