You and a group of friends wish to start a company. You have an idea, and...

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You and a group of friends wish to start a company. You have anidea, and you are comparing startup incubators to apply to.(Startup incubators hold classes and help startups to contactventure capitalists and network with one another) Assume funding isnormally distributed.
Incubator A has an 80% success ratiogetting companies to survive at least 4 years from inception. Theaverage venture funding of the 28 companies reaching that 4-yearmark, is 1.3 million dollars with a standard deviation of 0.6million
Incubator B has a 60% success ratiogetting companies to survive at least 4 years from inception. Theaverage venture funding of the 21 companies reaching that 4-yearmark, is 1.9 million dollars with a standard deviation of 0.55million
a. Are the success ratios significantly different? (note thecount is given but not N, how do you find N?)
b. Is the average funding in incubator B significantly differentfrom the average funding in a? (use a=0.01). Assume a normaldistribution

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3.6 Ratings (494 Votes)

aFor company A the sample proportion is For company B the sample proportion is The value of the pooled proportion is computed as Also the given significance level is 0051 Null and AlternativeHypothesesThe following null and alternative hypotheses need to betestedHop1p2Hap1p2This corresponds to a twotailed See Answer

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