PS1181
Mini Case#2
1. Conduct a test to determine if Japanese firms are more highly leveraged
than American
firms based on book-value-based capitalization ratios. Use α = .05.
2. Conduct a test to determine if Japanese firms are more highly leveraged
than American
firms based on market-value-based capitalization ratios. Use α = .05.
the shapes of the distributions of capitalization ratios differ between
American and Japanese firms. Both are non-normal.
The difference is not normal. Since we have to compare via the sectors of the two countries, we use
matched pairs and then Wilcoxon signed rank.
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