Conduct a two tailed test of equality of mean stock return

Reference no: EM131381069

Test the validity of the equal-variance assumption for the data presented in given problem.

Problem :-

An article reports the results of an analysis of stock market returns before and after antitrust trials that resulted in the breakup of AT&T. The study concentrated on two periods:

the pre-antitrust period of 1966 to 1973, denoted period 1, and the antitrust trial period of 1974 to 1981, called period 2. An equation similar to equation 8-7 was used to test for the existence of a difference in mean stock return during the two periods.

Conduct a two-tailed test of equality of mean stock return in the population of all stocks before and during the antitrust trials using the following data: n₁ = 21, x‾ = 0.105, s₁ = 0.09; n₂ = 28, x‾ = 0.1331, s₂ = 0.122. Use α = 0.05.

Reference no: EM131381069

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