Step 1: wishes to study what factors affect the percelived fairness of a change

Question

Step 1: wishes to study what factors affect the percelived fairness of a change in price of an item from its advertised price. In particular, does the type of change in pric (an Increase or decrease) and the source of the information about the change affect the perceived fairness? In an experiment, 20 subjects interested in purchasing a new rug are recruited. They are told that the prike of a rug in a certain store was advertise subjects are told by a store clerk that the price has store clerk that the price has decreased to $450. Five subjects learn that the price has decreased to $450 from the price tag on the rug. After learning about the change in price, each subject is asked to rate the fairness of the change on a 10-point scale with 1 very unfair to 10 very fair. d at $500. Subjects are sent, one at a time, to the store, where they learn that the price has changed. Fi to $550. Five subjects learn that the price has increased to $550 from the price tag on the rug. Flive subjects are told by a What Iis/are the explanatory variable(s) in this experiment? 0 whether the customer found out about the price change from the clerk or from the tag. Aprice increase of $50. O Whether the price increased or decreased. O The type of price change and how the customer found out about it

Explanation / Answer

Step 1.

The answer is in the first line of the question itself.

The 'type of change in price' and 'source of information about the change affect the perceived fairness' are the 2 explanatory variables which effect.

So, answer is D.

Step2: Answer is B, as the dependent variable or the outcome is the rating of fairness of the price shown to the subjects.

Step3: I dont know what' on page 121, but seems that C is the most appropriate way to describe problem at hand.

THere are 2 treatments clearly ( increase and decrease) and we have 4 groups in total.

Step4:

B is out as the clerk cant influence the treatment where subjects are shown tags. So, all customers are not treated alike as they are told about the price rise in different ways : rug and the clerk

C is out, as A gives out the potential problem

If not enough time is given then the they could compare notes and create a bias for fairness of price ( it is basically mixing subjects which will cause mixed rating)

A is right

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