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Evaluate: Five Step Testing Hypothesis

The following sample data shows the quarterly earnings in millions for two US companies. Your research interest is finding if the average earnings for these companies are different. Justify your answer by doing a five step testing of the hypothesis at the 0.05-level of significance. Show all the steps of the calculations.

Company 1......Company 2
17.8......................18.01
18.........................17.75
17.98.......................18
18.2......................17.77
18.00....................18.01
17.99....................18.01
18.1......................18.12
17.9......................18.2

Solution Summary

This solution provides the step by step methodology required for the five step hypothesis testing calculation and technique. Formula for the calculations and an interpretation of the results are also included. An interactive excel sheet is included and allows the user to edit the inputs so that it can be re-used in the future for a similar problem. The full solution is provided in a Word document which is attached.

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