Test the Hypothesis That $\mu _ { 1 } < \mu _ { 2 }$

question 59

Essay

Test the hypothesis that $\mu _ { 1 } < \mu _ { 2 }$ . Two samples are randomly selected from normal populations. The sample statistics are given below.
$$\begin{array} { l l } \mathrm { n } _ { 1 } = 15 & \mathrm { n } _ { 2 } = 15 \\\overline { \mathrm { x } } 1 = 24.73 & \overline { \mathrm { x } } 2 = 27.28 \\\mathrm {~s} _ { 1 } = 2.9 & \mathrm {~s} _ { 2 } = 2.8\end{array}$$

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Definitions:

Dividend Growth Model

A valuation method that estimates the price of a company’s stock based on the dividend per share and the dividend growth rate.

Constant Rate

A fixed rate, without variation or fluctuation over time.

Dividends

Dividends are payments made by a corporation to its shareholder members, usually derived from the company's profits.

Constant Growth Model

A method to value a stock by assuming that dividends grow at a constant rate indefinitely.