Many mutual funds use an investment approach involving owning stocks whose price/earn- ings multiples (P/Es) are less than the P/E of the S&P 500. The following data give P/Es of 49 companies a randomly selected mutual fund owns in a particular year.
|
6.8
|
5.6
|
8.5
|
8.5
|
8.4
|
7.5
|
9.3
|
9.4
|
7.8
|
7.1
|
|
9.9
|
9.6
|
9.0
|
9.4
|
13.7
|
16.6
|
9.1
|
10.1
|
10.6
|
11.1
|
|
8.9
|
11.7
|
12.8
|
11.5
|
12.0
|
10.6
|
11.1
|
6.4
|
12.3
|
12.3
|
|
11.4
|
9.9
|
14.3
|
11.5
|
11.8
|
13.3
|
12.8
|
13.7
|
13.9
|
12.9
|
|
14.2
|
14.0
|
15.5
|
16.9
|
18.0
|
17.9
|
21.8
|
18.4
|
34.3
|
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Find a 98% con?dence interval for the mean P/E multiples. Interpret the result and state any assumptions you have made.