A Portfolio Manager Was Analyzing the Price-Earnings Ratio for This

True/False

A portfolio manager was analyzing the price-earnings ratio for this year's performance.His boss said that the average price-earnings ratio was 20 for the many stocks,which his firm had traded,but he felt that figure was too high.The portfolio manager randomly selected a sample of 50 P/E ratios and found a mean of 18.17 and standard deviation of 4.60.Assume that the population is normally distributed and test at the 0.01 level of significance.
The decision is: Because the test statistic t = -2.81 falls in the rejection region,reject H0.At the 0.01 level,there is enough statistical evidence to conclude that the alternative hypothesis is true and that the average P/E ratio for the stocks is less than 20.