Playing the market: The Russell 2000 is a group of 2000 small-company stocks. On a recent day, a random sample of 35 of these stocks had a mean price of $26.89, with a standard deviation of $23.41. A stock market analyst predicted that the mean price of all 2000 stocks would be $25.00. Can you conclude that the mean price differs from $25.00?

a. State the null and alternate hypotheses.

b. Should we perform a z-test or a t-test? Explain.

c. Compute the value of the test statistic.

d. Do you reject H0? Use the α = 0.05 level.

e. State a conclusion.