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Let x be a random variable representing dividend yield of bank stocks. We may assume that x has a normal distribution with o = 2.7%.

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Let x be a random variable representing dividend yield of bank stocks. We may assume that x has a normal distribution with o = 2.7%. A random sample of 10 bank stocks gave the following yields (in percents). 5.7 4.8 6.0 4.9 4.0 3.4 6.5 7.1 5.3 6.1 The sample mean is x = 5.38%. Suppose that for the entire stock market, the mean dividend yield is y = 4.5%. Do these data indicate that the dividend yield of all bank stocks is higher than 4.5%? Use a = 0.01. (a) What is the level of significance? (Enter a number.) State the null and alternate hypotheses. Will you use a left-tailed, right-tailed, or two-tailed test? O Ho: H = 4.5%; H1: M > 4.5%; right-tailed O Ho: H = 4.5%; H: H # 4.5%; two-tailed O Ho: H = 4.5%; H1: H 4.5%; H1: H = 4.5%; right-tailed (b) What sampling distribution will you use? Explain the rationale for your choice of sampling distribution. The standard normal, since we assume that x has a normal distribution with unknown o. The Student's t, since we assume that x has a normal distribution with known o. The standard normal, since we assume that x has a normal distribution with known o. The Student's t, since n is large with unknown o. Compute the z value of the sample test statistic. (Enter a number. Round your answer to two decimal places.) (c) Find (or estimate) the P-value. (Enter a number. Round your answer to four decimal places.)

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