Question

Imagine your company is deciding whether they should sell a new product, but you first need to make sure that the public will be interested in it. You decide that you will release it nationwide if 35% of the people “like it enough to buy it.” You conduct a random sample of 400 consumers and discover that just 112 respondents said they liked it enough to buy it. Testing at the 95% significance level, can you conclude whether you should market this product?

Answer 1

Here, 112 respondents said they liked it enough to buy it

Percentage of 112 respondents=(112÷400)×100

=28%

It is less than 35%

Therefore the company cannot release the product nationwide

35% means there should be 140 respondents to buy the product,but there is only 112 respondents

95% means 380 respondents should be there to buy the product,but according to the given percentage(28%),there is only 304 respondents to buy the product.

That is,(95%÷35%)×112=304

So , at 95% significance level we should not market this product