The annual dividend rates for a random sample of 16 companies in three different industries, utilities, banking, and insurance were recorded. The ANOVA comparing the mean annual dividend rate among three industries rejected the null hypothesis that the dividend rates were equal. The Mean Square Error (MSE) was 3.36. The following table summarized the results: Based on the comparison between the mean annual dividend rate for companies in utilities and banking, the 95% confidence interval shows an interval of 1.28 to 6.28 for the difference. This result indicates that _____________________.
A)There is no significant difference between the two rates
B)The interval contains a difference of 5.00
C)The annual dividend rate in the utilities industry is significantly less than the annual dividend rate in the banking industry
D)The annual dividend rate in the banking industry is significantly less than the annual dividend rate in the utilities industry

Question

The annual dividend rates for a random sample of 16 companies in three different industries, utilities, banking, and insurance were recorded. The ANOVA comparing the mean annual dividend rate among three industries rejected the null hypothesis that the dividend rates were equal. The Mean Square Error (MSE) was 3.36. The following table summarized the results:  Based on the comparison between the mean annual dividend rate for companies in utilities and banking, the 95% confidence interval shows an interval of 1.28 to 6.28 for the difference. This result indicates that _____________________.
A)There is no significant difference between the two rates 
B)The interval contains a difference of 5.00 
C)The annual dividend rate in the utilities industry is significantly less than the annual dividend rate in the banking industry 
D)The annual dividend rate in the banking industry is significantly less than the annual dividend rate in the utilities industry

Quizplus · Accepted Answer

The confidence interval shows that the difference between the mean annual dividend rate for companies in utilities and banking could be as low as 1.28. Since the null hypothesis was rejected, this means there is evidence to suggest that the dividend rates for the two industries are not equal. Therefore, the most reasonable choice is that the annual dividend rate in the utilities industry is significantly less than the annual dividend rate in the banking industry.

The Annual Dividend Rates for a Random Sample of 16