Question

The manufacturer of an MP3 player wanted to know whether a 10% reduction in price is enough to increase the sales of its product. To investigate, the owner randomly selected eight outlets and sold the MP3 player at the reduced price. At seven randomly selected outlets, the MP3 player was sold at the regular price. Reported below is the number of units sold last month at the regular and reduced prices at the randomly selected outlets. Regular price 135 121 125 115 116 121 98 Reduced price 127 136 151 137 117 102 115 130 At the 0.100 significance level, can the manufacturer conclude that the price reduction resulted in an increase in sales? Hint: For the calculations, assume reduced price as the first sample. 1. Compute the pooled estimate of the variance. (Round your answer to 3 decimal places.) 2. Compute the test statistic. (Round your answer to 2 decimal places.) 3. State your decision about the null hypothesis. 4. Fail to reject H0 Reject H0

Answer 1

x1    =	118.714	x2      =	126.875
s1    =	11.295	s2      =	15.282
n1    =	7	n2     =	8

1)

Pooled Variance Sp2=((n1-1)s21+(n2-1)*s22)/(n1+n2-2)=

184.6387

2)

test stat t =(x1-x2-Δo)/Se=

1.16

3)

Decision rule :                   reject Ho if test statistic t>1.350

4()Fail to reject H0

answered by: anonymous