Are America's Top Chief Executive Officers (CEOs) Really Worth All

question 6

Multiple Choice

Are America's top chief executive officers (CEOs) really worth all that money? One way to answer this question is to look at row B, the annual company percentage increase in revenue, versus row A, the CEO's annual percentage salary increase in that same company. Suppose that a random sample of companies yielded the following data: $$\begin{array} { l | c c c c c c c c } \hline \text { B : Percent for company } & 18 & 8 & 7 & 6 & 10 & 23 & 23 & 26 \\\hline \text { A: Percent for CEO } & 19 & 10 & 6 & - 2 & 10 & 20 & 19 & 20 \\\hline\end{array}$$ Do these data indicate that the population mean percentage increase in corporate revenue (row B) is different from the population mean percentage increase in CEO salary? Use a 10% level of significance. What does the area of the sampling distribution corresponding to your P-value look like if the test statistic t = 1.918?

• A)shade are to the left of -1.918
• B)shade are to the left of -1.918 and to the right of 1.918
• C)shade are to the right of -1.918 and to the left of 1.918
• D)shade are to the right of 1.918

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Definitions:

Test Statistic

A computed value used to decide whether to reject the null hypothesis within the framework of statistical hypothesis testing.

Rejection Region

The range of values for which a null hypothesis is rejected in hypothesis testing.

Chi-Square Goodness-Of-Fit Test

A statistical test to determine if observed data fits a particular distribution.

Qualitative Data

Data that is descriptive and categorizes objects or events, not expressed as numbers.