Question 144762: 1. A study conducted by Ariel Mutual Funds and Charles Schwab Corporation surveyed 500 African American with an annual income above $50,000 and 500 white Americans with an annual income above $50,000. The results indicated that 74% of the African Americans and 84% of the whites owned stocks (Cheryl Winokur Munk, “Stock-Ownership Race Gap Shrinks,”. “The Wall Street Journal, June 13, 2002, B11). Is there a difference between the proportion of African American with an annual income above $50,000 who invest in stocks and the proportion of whites with income an annual income above $50,000 who invest in stocks at a 95% level of confidence?
Answer by stanbon(75887)   (Show Source):
You can put this solution on YOUR website! Schwab Corporation surveyed 500 African American with an annual income above $50,000 and 500 white Americans with an annual income above $50,000. The results indicated that 74% of the African Americans and 84% of the whites owned stocks (Cheryl Winokur Munk, “Stock-Ownership Race Gap Shrinks,”. “The Wall Street Journal, June 13, 2002, B11). Is there a difference between the proportion of African American with an annual income above $50,000 who invest in stocks and the proportion of whites with income an annual income above $50,000 who invest in stocks at a 95% level of confidence?
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Ho: u(white) - u(black) = 0
Ha: u(w) - u(b) is not zero
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I ran a 2-PropZTest on a TI calculator and got the following:
test statistic: z = 3.8819...
p-value: 2P(3.8819.. < z < 10) = 0.00010367..
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Conclusion: Since p-value is less than 5%, reject Ho.
There is a difference between ...etc.
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Cheers,
Stan H.
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