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Question: Mutual funds. In March 2002, Consumer Reports listed the rate of return for several large-cap mutual funds over the previous 3-year and 5-year periods. ("Large cap" refers to companies worth over $10 billion.)
a) Create a 95% confidence interval for the difference in rate of return for the 3- and 5-year periods covered by these data. Clearly explain what your interval means.
b) It's common for advertisements to carry the disclaimer "Past returns may not be indicative of future performance," but do these data indicate that there was an association between 3-year and 5-year rates of return?
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