The Standard and Poor's 500 Index is a benchmark against which investors compare the performance of individual stocks. A sample of eight of the manufacturing companies included in the index were evaluated for profitability in 1998 and 1999 with the results shown in the table below. The profitability measure used was net margin-defined as net income from continuing operations before extraordinary items as a percentage of sales.

a. Is there sufficient evidence to conclude that U.S.
manufacturing f~rms were more profitable in 1999 than 1998? Test using a = .05.

b. What assumptions must be met to ensure the validity of the test in part a?