The printout below refers to the weekly closing stock prices for Air Canada on 20 randomly selected weeks in 2000. Using a 5% level of significance, can you say that the average Air Canada stock price was different from $19.50?
A) Fail to reject the null hypothesis and conclude the mean stock price was $19.50.
B) Reject the null hypothesis and conclude the mean stock price was lower than $19.50.
C) Reject the null hypothesis and conclude the mean index was greater than $19.50.
D) Reject the null hypothesis and conclude the mean index was different from $19.50.

Question

The printout below refers to the weekly closing stock prices for Air Canada on 20 randomly selected weeks in 2000.  Using a 5% level of significance, can you say that the average Air Canada stock price was different from $19.50?
A) Fail to reject the null hypothesis and conclude the mean stock price was $19.50. 
B) Reject the null hypothesis and conclude the mean stock price was lower than $19.50. 
C) Reject the null hypothesis and conclude the mean index was greater than $19.50. 
D) Reject the null hypothesis and conclude the mean index was different from $19.50.

Quizplus · Accepted Answer

We need to conduct a one-sample t-test to determine if the average stock price is significantly different from $19.50. The null hypothesis is that the mean stock price is equal to $19.50, and the alternative hypothesis is that it is different from $19.50. Looking at the t-test output, we see that the p-value is less than 0.05, indicating that we can reject the null hypothesis. Therefore, we conclude that the mean stock price is different from $19.50.

The Printout Below Refers to the Weekly Closing Stock Prices