A retailer is interested in investigating whether doubling the value of manufact

Question

A retailer is interested in investigating whether doubling the value of manufacturer coupons will increase the number of shoppers. “Doubling” means that the store would give consumers a discount equal to twice the coupon face value, with the retailer absorbing the cost of the extra discount. Write the null and alternative hypotheses associated with this test that would need to be performed in order to provide this information. Also indicate the type of data that should be collected to best test the hypothesis, and the type of statistical test that would need to be performed.

Explanation / Answer

Answer:

·       A retailer is interested in investigating whether doubling the value of manufacturer coupons will increase the number of shoppers.

·       “Doubling” means that the store would give consumers a discount equal to twice the coupon face value, with the retailer absorbing the cost of the extra discount.

Null Hypothesis: This is the hypothesis generally show the natural occurrences of the events. Thus the Null hypothesis statement should be written in the natural occurring sense for the given problem.

It is denoted with Ho

Null Hypothesis: Ho = Doubling the coupon face value will increase the shoppers

Alternate Hypothesis: This is the hypothesis generally show the non-natural occurrences of the events. Thus the Alternate hypothesis statement should be written in against the natural occurring sense for the given problem.

It is denoted with Ha

Alternate Hypothesis: Ha : Doubling the coupon face value will not increase the shoppers.

Hypothesis testing

·       Ho = Doubling the coupon face value will increase the shoppers

·       Ha : Doubling the coupon face value will not increase the shoppers.

Type of data that should be collected to best test the hypothesis: We need to take the sample data collection and need to analyze the impacts of the doubling face value of coupons and need to review the impacts on the shoppers. The sampling method will help to judge the hypothesis and will be able to accept or reject the hypothesis based on the sample data analysis.

The type of statistical test that would need to be performed: Chi Square test would be suitable test for analyzing the hypothesis.

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