Increasing Stocks Survey

Look at yesterdays newspaper business section. Conduct a hypothesis test to determine if the proportion of New York Stock Exchange (NYSE) stocks that increased is greater than the proportion of NASDAQ stocks that increased. As randomly as possible, choose 40 NYSE stocks and 32 NASDAQ stocks and complete the following statements.

1.Ho: : p1-p2=0

2.Ha: p1 - p2 >0

3.In words, define the random variable: the proportions of stocks going up each day in the NYSE and NASDAQ stock exchanges.

4.The distribution to use for the test is: Normal Distribution

5.Calculate the test statistic using your data.

z = (p1 - p2) - 0/ (p1q1/n1)+(p2q2/n2)

where q = 1-p

and n1 and n2 are the two sample sizes 40 and 32.

6.Draw a graph and label it appropriately. Shade the actual level of significance.

a.Graph:

b.Calculate the p-value

7.Do you reject or not reject the null hypothesis?

8.Write a clear conclusion using a complete sentence.