Question 319933: Forecasters' interest rate predictions over the period 1982-1990 were studied to see whether the predictions corresponded to what actually happened. The 2x2 contingency table below show the frequencies of actual and predicted interest rate movements. At a = .10, is the actual change independent of the predicted change? (Date are from R.A. Kolb and H. O. Steckler, "Howe Well Do Analysis Forecast Interest Rates?" Journal of Forecasting 15, no. 15 (1990), pp. 385-394).
Forecasted Change Rate Fell Rates Rose Row Total
Rates would fall 7 12 19
Rates would rise 9 6 15
Col. Total 16 18 34
Answer by stanbon(75887)   (Show Source):
You can put this solution on YOUR website! Ho: row and column ae independent
Ha: they are not
---
I ran a Chi-Sq test of the 2x2 matrix and got:
test stat: Chi-Sq = 1.8044
p-value: 0.1792
----------
Since P-value is greater than 5%, fail to reject Ho.
======================
Cheers,
Stan H.
|
|
|
