A. Calculate the 95% confidence interval for the population mean downtime for each of the two years.

B. At this confidence level, is it possible to reject the hypothesis that downtime experience is the same during each of these two years?

P3.7 Correlation. Managers focus on growth rates for corporate assets and profitability as indicators of the overall health of the corporation. Similarly, investors concentrate on rates of growth in corporate assets and profitability to gauge the future profit-making ability of the firm, and the company's prospects for stock-market appreciation. Five familiar measures focused upon by both managers and investors are the rates of growth in sales revenue, cash flow, earnings per share (EPS), dividends, and book value (shareholders' equity).

The table shown here illustrates the correlation among these five key growth measures over a 10-year period for a sample of large firms taken from The Value Line Investment Survey. Value Line reports extensive operating and stock-market data for roughly 1,500 companies on a regular basis, and is a popular tool for individual investors.

Correlation Analysis of 10-year Corporate Growth Indicators

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