Mutual funds are the most common way people invest for the future with more than $20 trillion in investment assets. They are so popular because theyare a simple, convenient way to invest in stocks, bonds, money markets, commodities and other securities. Nearly half of all Canadian households invest in mutual funds. These professionally managed investment products use money from investors to create a diversified pool of securities to achieve a specific investment objective. Investors purchase shares, which represent ownership in the mutual fund. The price of the fund fluctuates based on the gain or loss of the securities that make up the fund.

Because each mutual fund has a specific investment objective, such as growth, capital preservation, or income, it is important to understand which funds are designed to meet the investor objectives. For example Asset Allocation Funds invest in a mix of stocks, bonds, alternatives and money market securities, where as TK Funds emphasize on the Science and Technology stocks.

The database containing the following variables in Excel spreadsheet called MutualFundsfile.xls.

- Fund Names

- Objective

- Sales Charge (Use1 for Yes and 0 for No)

- Expense Ratio

- Risk (High, Average and Low)

- Return 1999

- Return Q1-2000

- Three-year Return

1. Construct a contingency table between Risk and Sales Charge. Use the table to show whether there is a relationship between the two variables at = 5% significance level. Explain your conclusion in the context of the problem. For the Average risk funds only, test the proportion of funds with the Sales Charge differs from 0.50 use = 0.05. Explain your conclusion.

1. For the Average risk funds only, set up a 95% confidence interval for the proportion of funds with the Sales Charge and compare your conclusion with the one in the previous part. Here is the link to the excel file: https://docs.google.com/spreadsheets/d/1IgpuEqmUj-fVIUqoom1xXgz15gsyxXSg/edit?usp=sharing&ouid=104765617034783818268&rtpof=true&sd=true Please answer the two first questions with explanations :)