Question
An investment analyst is evaluating the 10-year mean return on investment for industry-specific exchange-traded funds (ETFs) for three sectors: financial, energy, and technology. The analyst
An investment analyst is evaluating the 10-year mean return on investment for industry-specific exchange-traded funds (ETFs) for three sectors: financial, energy, and technology. The analyst obtains a random sample of 30 ETFs for each sector and calculates the 10-year return of each ETF. The analyst has provided you with this data set.
Using the sample data, perform one-way analysis of variance (ANOVA). Evaluate whether the average return of at least one of the industry-specific ETFs is significantly different. Use a 5% level of significance.
Please address the following items:
1. Define the null and alternative hypothesis in mathematical terms and in words.
2. Report the level of significance.
3. Include the test statistic and the P-value
4. Provide your conclusion and interpretation of the test. Should the null hypothesis be rejected? Why or why not?
5. Does a side-by-side boxplot of the 10-year returns of ETFs from the three sectors confirm your conclusion of the hypothesis test? Why or why not?
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