SOLUTION: It is hypothesized that the market share of a corporation should vary more in an industry with active price competition than in one with duopoly and tacit collusion. Suppose that i

Question 1085768: It is hypothesized that the market share of a corporation should vary more in an industry with active price competition than in one with duopoly and tacit collusion. Suppose that in a study of the steam turbine generator industry, it was found that in 4 years of active price competition, the variance of General Electric's market share was 85.7. In the following 7 years, in which there was duopoly and tacit collusion, this variance was 23.91. Assume that the data can be regarded as an independent random sample from two normal distributions. Test the null hypothesis that the two population variances are equal against the alternative that the variance of market share is higher in years of active price competition. Answer the following, rounding off your answers to two decimal places.
I calculated test statistic to be 85.7/23.91 = 3.5843
And with a 5 % significance level, critical value to be 4.76
I need help finding the P-value for the test
Answer by rothauserc(4718) (Show Source): You can put this solution on YOUR website!
the test statistic is a z-score
:
z-score = 3.5843 is a probability of 1 - 0.999 = 0.001
:
Since this is less than the significance level of 0.05, we reject the null hypothesis.
:

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