Reference no: EM132021832

Often, it is interesting to know whether mean adjusted closing prices have changed from some base value. Suppose you are interested in whether the mean adjusted daily closing price for the stock you downloaded in Module 1 has increased from some base price (for example, $4 or $10 or . . .). For our purposes, we will assume that you are interested in whether the mean daily adjusted closing price has increased from the oldest daily adjusted closing price in your dataset (for example, the one from five years ago). Conduct a hypothesis test that the mean adjusted daily closing price has increased from the base price. Assume that the stock price is sufficiently normal to conduct a t-test. Note: you might also transform the stock to normality, that is, applying the natural logarithm.

1. State the null and alternative hypotheses via both an explanation and a math equation.

Is what I have correct? i am confused if I am dealing with just the adjusted close price or do I need to look at the base price also? Is the null hypotheisis?