Economics: Productivity An economist wonders if corporate

Chapter , Problem 7

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Economics: Productivity An economist wonders if corporate productivity in some countries is more volatile than in other countries. One measure of a companys productivity is annual percentage yield based on total company assets. Data for this problem are based on information taken from Forbes Top Companies, edited by J. T. Davis. A random sample of leading companies in France gave the following percentage yields based on assets: 4.4 5.2 3.7 3.1 2.5 3.5 2.8 4.4 5.7 3.4 4.1 6.8 2.9 3.2 7.2 6.5 5.0 3.3 2.8 2.5 4.5 Use a calculator to verify that s 2 2.044 for this sample of French companies. Another random sample of leading companies in Germany gave the following percentage yields based on assets: 3.0 3.6 3.7 4.5 5.1 5.5 5.0 5.4 3.2 3.5 3.7 2.6 2.8 3.0 3.0 2.2 4.7 3.2 Use a calculator to verify that s 2 1.038 for this sample of German companies. Test the claim that there is a difference (either way) in the population variance of percentage yields for leading companies in France and Germany. Use a 5% level of significance. How could your test conclusion relate to the economists question regarding volatility (data spread) of corporate productivity of large companies in France compared with companies in Germany? 8