BA 303 - BUSINESS STATISTICS - Week 5: Learning Unit 1: Discussion 1: Chapter 7, Problem 34

In the Excel file Credit Risk Data, test the hypotheses that the number of months employed is the same for applicants with low credit risk as for those with high credit risk evaluations. Use a level of significance of 0.05.

In the Excel file Credit Risk Data, test the hypotheses that the number of months employed is the same for applicants with low credit risk as for those with high credit risk evaluations. Use a level of significance of 0.05.

If t Stat is larger than the critical two-tail value, we reject Ho. In this case, t Stat is -1.956808 whereas t Critical two-tail is 1.9656147. t Stat is smaller than t Critical value, therefore, Ho will not be rejected. Therefore, the data support Ho meaning that the number of months employed can be considered equal for applicants with low credit risk as for those with high credit risk evaluations.