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3 (15 points) Let X denote the annual growth rate of the earnings of a rm. Suppose that X follows a normal distribution with mean

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3 (15 points) Let X denote the annual growth rate of the earnings of a rm. Suppose that X follows a normal distribution with mean ,u. and variance 02. A random sample X1, X2, .., X25 of size 25 is available. You are given that X = 3.14 and S = 2.88. 3.1 10 points You are going to invest if the average earning growth is more than 4 percent. Write down the null and alternative hypotheses and conduct a test with 5 percent signicance level. Are you going to invest or not? 3.2 5 points Construct onesided 0.95 level upper tail condence interval for a. Interpret your result

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