A company's price/earnings (P/E) ratio is the company's current stock price divided by the latest 12 months' earnings per share. Suppose the following table shows the P/E ratios for a sample of 10 Japanese companies and 12 U.S. companies. Japan P/E Ratio 156 28 14 129 38 216 67 665 36 64 United States P/E Ratio 12 27 27 46 23 17 28 17 28 34 19 17 Is the difference between the P/E ratios for the two countries significant? Use the MWW test and ? = 0.01 to support your conclusion. State the null and alternative hypotheses. H0: The two populations of P/E ratios are identical. Ha: The two populations of P/E ratios are not identical.H0: The two populations of P/E ratios are not identical. Ha: The two populations of P/E ratios are identical. H0: Median for Japanese companies − Median for U.S. companies > 0 Ha: Median for Japanese companies − Median for U.S. companies = 0H0: Median for Japanese companies − Median for U.S. companies ≤ 0 Ha: Median for Japanese companies − Median for U.S. companies > 0H0: Median for Japanese companies − Median for U.S. companies ≥ 0 Ha: Median for Japanese companies − Median for U.S. companies < 0 Find the value of the test statistic. W = Find the p-value. (Round your answer to four decimal places.) p-value = State your conclusion. Do not reject H0. There is not sufficient evidence to conclude that there is a significant difference between the P/E ratios for the two countries.Do not reject H0. There is sufficient evidence to conclude that there is a significant difference between the P/E ratios for the two countries. Reject H0. There is sufficient evidence to conclude that there is a significant difference between the P/E ratios for the two countries.Reject H0. There is not sufficient evidence to conclude that there is a significant difference between the P/E ratios for the two countries.

MATLAB: An Introduction with Applications

6th Edition

ISBN:9781119256830

Author:Amos Gilat

Publisher:Amos Gilat

Chapter1: Starting With Matlab

Section: Chapter Questions

Problem 1P

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Question

A company's price/earnings (P/E) ratio is the company's current stock price divided by the latest 12 months' earnings per share. Suppose the following table shows the P/E ratios for a sample of 10 Japanese companies and 12 U.S. companies.

Japan
P/E Ratio
156
28
14
129
38
216
67
665
36
64

United States
P/E Ratio
12
27
27
46
23
17
28
17
28
34
19
17

Is the difference between the P/E ratios for the two countries significant? Use the MWW test and ? = 0.01 to support your conclusion.

State the null and alternative hypotheses.

H₀: The two populations of P/E ratios are identical.
H_a: The two populations of P/E ratios are not identical.H₀: The two populations of P/E ratios are not identical.
H_a: The two populations of P/E ratios are identical. H₀: Median for Japanese companies − Median for U.S. companies > 0
H_a: Median for Japanese companies − Median for U.S. companies = 0H₀: Median for Japanese companies − Median for U.S. companies ≤ 0
H_a: Median for Japanese companies − Median for U.S. companies > 0H₀: Median for Japanese companies − Median for U.S. companies ≥ 0
H_a: Median for Japanese companies − Median for U.S. companies < 0

Find the value of the test statistic.

W =

Find the p-value. (Round your answer to four decimal places.)

p-value =

State your conclusion.

Do not reject H₀. There is not sufficient evidence to conclude that there is a significant difference between the P/E ratios for the two countries.Do not reject H₀. There is sufficient evidence to conclude that there is a significant difference between the P/E ratios for the two countries. Reject H₀. There is sufficient evidence to conclude that there is a significant difference between the P/E ratios for the two countries.Reject H₀. There is not sufficient evidence to conclude that there is a significant difference between the P/E ratios for the two countries.

Definition Definition Middle value of a data set. The median divides a data set into two halves, and it also called the 50th percentile. The median is much less affected by outliers and skewed data than the mean. If the number of elements in a dataset is odd, then the middlemost element of the data arranged in ascending or descending order is the median. If the number of elements in the dataset is even, the average of the two central elements of the arranged data is the median of the set. For example, if a dataset has five items—12, 13, 21, 27, 31—the median is the third item in ascending order, or 21. If a dataset has six items—12, 13, 21, 27, 31, 33—the median is the average of the third (21) and fourth (27) items. It is calculated as follows: (21 + 27) / 2 = 24.

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