Question 2: The Office of the Superintendent of Bankruptcy of Canada (OSBC) is developing a new...

90.2K

Verified Solution

Question

Statistics

Question 2: The Office of the Superintendent of Bankruptcy ofCanada (OSBC) is developing a new index to measure thevulnerability of firms in the new technology industry. The index isa ratio of current assets to current liabilities adjusted forvarious factors specific to this industry. The OSBC wants tocompare the index among healthy and failed firms for validationpurposes. They expect that failed firms should have a lower indexthan the healthy ones. Based on a Canadian business registry, theydraw a random sample of 68 firms still in operations and anotherrandom sample of 33 firms which failed in the last 3 years. Indexdata for the sampled firms based on their latest financialstatements are included in the Minitab file Bankruptcy_Index.mtwand in the Excel file Assign2.xlsx under the Bankruptcy_Index tab.Data is below:
a) Use Minitab or other appropriate software to produce boxplotsof the index values for the two groups of firms and comment ontheir distribution. 2Â Â
b) Use an appropriate statistical test to determine, at the 1%significance level, whether the data provide evidence of a higheraverage index for the healthy firms. Make sure you provide yourmanual calculations using the critical valueapproach.Â Â
c) Calculate manually a 99% one-sided confidence interval forthe difference in the average index of healthy and failed firms andcompare your results with b) above.
d) Use Minitab or other appropriate software to perform thecalculations in b) and c) above and comment on any differences
Here is the data for Bankruptcy_Index.mtw
Healthy Failed
1.5 0.82
2.08 0.05
2.23 1.68
0.89 0.91
1.91 1.16
1.2 0.42
1.95 0.88
2.73 1.11
1.62 2.03
1.71 0.92
1.03 0.73
1.96 0.89
0.1 0.83
1.43 0.99
2.5 0.52
0.23 1.32
1.67 0.48
2.17 1.1
2.61 0.19
1.56 0.51
1.76 0.26
1.02 0.88
1.8 1.31
1.81 0.9
1.76 0.62
0.68 1.45
2.02 1.17
1.2 0.93
1.87 0.75
2.61 0.13
1.11 1.12
2.73 1.15
2.22 0.71
2.5
0.67
1.14
3.15
1.44
2.16
1.21
3.05
0.95
0.9
2.8
1.55
2.44
1.84
1.24
1.39
1.8
2.05
1.52
0.96
2.12
1.85
1.69
2.3
2.21
2.03
1.64
1.87
1.06
1.93
2.25
1.42
0.96
1.64
2.21

Answer & Explanation Solved by verified expert

4.4 Ratings (944 Votes)

Questiona Use Minitab or other appropriate software to produceboxplots of the index values for the two groups of firms andcomment on their distributionBox plot from minitab is given below you can get the same from paste the data on minitab and use menugraphboxplot and select the data and put in ggraph variables andclick OKInterpretation of Distribution Key things to look Median ie line in middle of dark box Interquarttilee range box black box in middle represents50Outlier Failed cases show an outlier ie datapoint which isfar from other data values Spread Indicates variability See Answer

Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:

Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!

Become a Member

Healthy	Failed
1.5	0.82
2.08	0.05
2.23	1.68
0.89	0.91
1.91	1.16
1.2	0.42
1.95	0.88
2.73	1.11
1.62	2.03
1.71	0.92
1.03	0.73
1.96	0.89
0.1	0.83
1.43	0.99
2.5	0.52
0.23	1.32
1.67	0.48
2.17	1.1
2.61	0.19
1.56	0.51
1.76	0.26
1.02	0.88
1.8	1.31
1.81	0.9
1.76	0.62
0.68	1.45
2.02	1.17
1.2	0.93
1.87	0.75
2.61	0.13
1.11	1.12
2.73	1.15
2.22	0.71
2.5
0.67
1.14
3.15
1.44
2.16
1.21
3.05
0.95
0.9
2.8
1.55
2.44
1.84
1.24
1.39
1.8
2.05
1.52
0.96
2.12
1.85
1.69
2.3
2.21
2.03
1.64
1.87
1.06
1.93
2.25
1.42
0.96
1.64
2.21