The manufacturer of an MP3 player wanted to know whether a 10 percent reduction
ID: 3263619 • Letter: T
Question
The manufacturer of an MP3 player wanted to know whether a 10 percent 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 sampled outlets.
Regular price
130
124
88
119
144
122
96
Reduced price
128
131
152
132
114
102
118
114
At the .005 significance level, can the manufacturer conclude that the price reduction resulted in an increase in sales? Hint: For the calculations, assume the "Reduced price" as the first sample.
The manufacturer of an MP3 player wanted to know whether a 10 percent 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 sampled outlets.
Explanation / Answer
a) pooled variance - 299.1222527 = 299.12
b) test statistic = 0.704223804
c) p-value = 0.2468580743
since p-value > 0.005
we fail to reject the null hypothesis
Please rate my solution
t-Test: Two-Sample Assuming Equal Variances Reduced Price Regular Price Mean 123.875 117.5714286 Variance 233.2678571 375.952381 Observations 8 7 Pooled Variance 299.1222527 Hypothesized Mean Difference 0 df 13 t Stat 0.704223804 P(T<=t) one-tail 0.246858074 t Critical one-tail 1.770933396 P(T<=t) two-tail 0.493716149 t Critical two-tail 2.160368656Related Questions
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