Suppose a mutual fund qualifies as having moderate risk if the standard deviation of its monthly rate of return is less than 3%. A mutual-fund rating agency randomly selects 26 months and determines the rate of return for a certain fund. The standard deviation of the rate of return computed to o be 2.24%. Is there sufficient evidence to conclude that the fund has moderate risk at the a =0.01 level of significance? A normal probability plot indicates that the monthly rates of return are normally distributed. What are the correct hypotheses for this test? The null hypothesis is Ho: The alternative hypothesis is H,:

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Suppose a mutual fund qualifies as having moderate risk if the standard deviation of its monthly rate of return is less than 3%. A mutual-fund rating agency randomly selects 26 months and determines the rate of return for a certain fund. The
standard deviation of the rate of return
computed to be 2.24%. Is there sufficient evidence to conclude that the fund has moderate risk at the a=0.01 level of significance? A normal probability plot indicates that the monthly rates of return are
normally distributed.
What are the correct hypotheses for this test?
The null hypothesis is Hg:
The alternative hypothesis is H,:
Transcribed Image Text:Suppose a mutual fund qualifies as having moderate risk if the standard deviation of its monthly rate of return is less than 3%. A mutual-fund rating agency randomly selects 26 months and determines the rate of return for a certain fund. The standard deviation of the rate of return computed to be 2.24%. Is there sufficient evidence to conclude that the fund has moderate risk at the a=0.01 level of significance? A normal probability plot indicates that the monthly rates of return are normally distributed. What are the correct hypotheses for this test? The null hypothesis is Hg: The alternative hypothesis is H,:
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