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Find variance of the stock price movements

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Reference no: EM131695943

Question: An important measure of the risk associated with a stock is the standard deviation, or variance, of the stock's price movements. A financial analyst wants to test the one-tailed hypothesis that stock A has a greater risk (larger variance of price) than stock B. A random sample of 25 daily prices of stock A gives s2A = 6.52, and a random sample of 22 daily prices of stock B gives a sample variance of s2B = 3.47. Carry out the test at α = 0.01.

Reference no: EM131695943

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