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A sample of 60 mutual funds was taken and the mean return in the sample was 13%

ID: 2505394 • Letter: A

Question

A sample of 60 mutual funds was taken and the mean return in the sample was 13% with a standard deviation of 6.9%. The return on a particular index of stocks (against which the mutual funds are compared) was 11.5%. What is the null and alternative hypothesis when testing the hypothesis (at the 5% level of significance) that the actively-manages mutual funds had a statistically significantly greater return than the index of stocks?                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              A sample of 60 mutual funds was taken and the mean return in the sample was 13% with a standard deviation of 6.9%. The return on a particular index of stocks (against which the mutual funds are compared) was 11.5%. What is the null and alternative hypothesis when testing the hypothesis (at the 5% level of significance) that the actively-manages mutual funds had a statistically significantly greater return than the index of stocks?

Explanation / Answer