Small business. The director of a small business development center located in a mid-sized city is reviewing data about its clients. In particular, she is interested in ex- amining if the distribution of business owners across the various stages of the business life cycle is the same for white-owned and Hispanic-owned businesses. The data are shown below.
|
|
White-Owned
|
Hispanic-Owned
|
|
Planning
|
11
|
9
|
|
Starting
|
14
|
11
|
|
Managing
|
20
|
2
|
|
Getting Out
|
15
|
1
|
a) Will you test goodness-of-fit, homogeneity, or independence?
b) Write the appropriate hypotheses.
c) Find the expected counts for each cell and explain why chi-square procedures are not appropriate for this table.
d) Create a new table by combining categories so that a chi-square procedure can be used.
e) With this change in the table, what has happened to the number of degrees of freedom?
f) Test your hypothesis about the two groups and state an appropriate conclusion.