Fidelity Magellan is a large-cap growth mutual fund and Fidelity Small Cap Stock is a small-cap growth mutual fund (Morningstar Funds 500, 2006). The standard deviation for both funds was computed based on a sample of size 26. For Fidelity Magellan, the sample standard deviation is 8.89%; for Fidelity Small Cap Stock, the sample standard deviation is 13.03%. Financial analysts often use the standard deviation as a measure of risk. Conduct a hypothesis test to determine whether the small-cap growth fund is riskier than the large-cap growth fund. Use α = .05 as the level of significance.

Consider that the population standard deviation of the small-cap growth fund is σ1 and the…

Answered: Fidelity Magellan is a large-cap growth…

MATLAB: An Introduction with Applications

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Fidelity Magellan is a large-cap growth mutual fund and Fidelity Small Cap Stock is a small-cap growth mutual fund (Morningstar Funds 500, 2006). The standard deviation for both funds was computed based on a sample of size 26. For Fidelity Magellan, the sample standard deviation is 8.89%; for Fidelity Small Cap Stock, the sample standard deviation is 13.03%. Financial analysts often use the standard deviation as a measure of risk. Conduct a hypothesis test to determine whether the small-cap growth fund is riskier than the large-cap growth fund. Use α = .05 as the level of significance.

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