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Hypothesis

A corporate CEO reviews the earnings of three divisions over the last eighteen months. Each division reports its earnings quarterly. Based on the earnings below, is there sufficient evidence to conclude, at the 99% level of confidence, that one of these divisions is more profitable than the others?

Division I Division II Division III
45 5 22
52 13 15
57 34 22
19 28 4
57 12 9
4 5 13

· State the null and alternate hypotheses
· Calculate the sums of squares SS(total), SS(factor), and SS(error)
· Calculate the degrees of freedom df(total), df(factor), and df(error)
· Calculate the mean square for factor, and the mean square for error
· Calculate the F-statistic
· Determine the critical value(s)
· State your decision: Should the null hypothesis be rejected?

Solution Summary

The profits from three divisions, sum of squares and degree of freedom are determined. A Complete, Neat and Step-by-step Solution is provided in the attached file.

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