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You suspect that an executive is laundering money from his drug-dealing syndicate by running the receipts through his otherwise legitimate business. One of the
You suspect that an executive is laundering money from his drug-dealing syndicate by running the receipts through his otherwise legitimate business. One of the ways he extracts the illicit money from the business is by paying certain employees, known to be relatives and friends of his, more than the prevailing wage rate. To test this, you select two employees from each of the company's 12 divisions. One of the employees is a friend/relative of the executive; the other is not. Althought the wage rates differ across the divisions, within each division they are relatively constant. Is there evidence to support the hypothesis that the executive is paying his friends and relatives more than other employees? wage rate friend/ Division relative unrelated A 18.06 23.35 B 25.29 23.46 28.13 25.09 D 30.80 27.65 E 32.32 29.88 F 33.39 28.70 G 34.31 35.38 H 35.97 31.71 I 37.75 35.12 J 39.78 37.21 K 45.69 42.57 L 52.89 54.82
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