A sample of years to maturity and yield for 40 corporate bonds taken from Barron's is given below. Years to Maturity Yield 10.25 7.739 17.50 7.173 19.00 4.241 9.50 3.997 27.50 5.399 11.50 6.782 24.75 8.176 5.75 8.154 23.25 3.030 25.00 6.697 12.75 4.170 7.75 2.725 11.25 3.873 18.50 8.120 28.50 7.189 5.00 1.512 5.00 3.483 2.50 7.165 26.50 2.812 22.50 7.677 13.75 6.125 13.00 4.128 1.25 6.518 16.75 2.969 2.00 2.977 29.50 3.574 3.50 3.689 21.25 0.910 24.00 2.673 4.00 7.965 15.25 4.929 9.00 3.836 20.00 6.040 15.00 8.187 7.25 5.128 21.00 7.444 25.75 6.721 28.75 5.392 16.50 2.707 6.50 3.742 a. What is the sample mean years to maturity for corporate bonds and what is the sample standard deviation? Mean years (to 2 decimals) Standard deviation years (to 2 decimals) b. Develop a 95% confidence interval for the population mean years to maturity. Round the answer to two decimal places. ( , ) years c. What is the sample mean yield on corporate bonds and what is the sample standard deviation? Mean % (to 4 decimals) Standard deviation % (to 4 decimals) d. Develop a 95% confidence interval for the population mean yield on corporate bonds. Round the answer to four decimal places. ( , ) percent
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First, we need to calculate the sample mean years to maturity for corporate bonds. To do this, we will add up all the years to maturity and divide by the number of bonds (40). Mean years to maturity = (10.25 + 17.50 + 19.00 + 9.50 + 27.50 + 11.50 + 24.75 + 5.75 + Show more…
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Table 2 Bond Yields and Years to Maturity* Corporate Bonds Summary Statistics Yield Year to Maturity Mean 3.8854 9.7063 Standard Error 0.2561 1.2618 Median 3.9480 9.2500 Mode #N/A 5 Standard Deviation 1.6194 7.9805 Sample Variance 2.6225 63.6887 Kurtosis 0.2808 1.1807 Skewness 0.1728 1.4707 Range 28.7500 Minimum 0.7670 1.0000 Maximum 8.2040 29.7500 Sum 155.4140 388.2500 Count 40 40 Confidence Level (95.0%) 0.5179 Missing * Based on a sample of 40 S&P 500 companies issuing bonds Referring to the sample of 40 S&P 500 companies issuing bonds in Table 2 above, what is the range of yields? 0.767 8.204 7.437 1.003 2.226
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