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The manager of a large company that sells pet supplies online wants to increase sales by encouraging repeat purchases. The manager believes that if past customers are offered $10 off their next purchase, more than 40 percent of them will place an order. To investigate the belief, 90 customers who placed an order in the past year are selected at random. Each of the selected customers is sent an e-mail with a coupon for $10 off the next purchase if the order is placed within 30 days. Of those who receive the coupon, 38 place an order.

Required:
a. Is there convincing statistical evidence, at the significance level of a = 0.05, that the managerâs belief is correct? Complete the appropriate inference procedure to support your answer.
b. Based on your conclusion from part (a), which of the two errors, Type I or Type II, could have been made? Interpret the consequence of the error in context.


Sagot :

Answer:

There is not a convincing statistical evidence, at the significance level of a = 0.05, that the manager's belief is correct.

As the null hypothesis maybe false accepting it makes a type II error.

Step-by-step explanation:

Let the null and alternate hypotheses be

H0: p ≤ 0.4  vs Ha : p>0.4

q= 1-p= 1-0.4= 0.6

The significance level alpha is 0.05

The critical region for one tailed test is Z> ± 1.645

The sample proportion is p^= x/n= 38/90=0.42222

Using the z statistic

z= p^- p/ √pq

z= 0.422-0.4/ √0.4*0.6

z= 0.04536

Since the calculated value of z= 0.04536 does not lie in the critical region  Z> ± 1.645 we fail to reject null hypothesis.

There is not sufficient evidence to support the manager's claim.

Type I error is when we reject the true null hypothesis .

Type II error is when we accept the false null hypothesis .

As the null hypothesis maybe false accepting it makes a type II error.

There is not enough statistical evidence that the managers' claim is true.

What is the z test statistic for one sample proportion?

Suppose that we have:

  • n = sample size
  • [tex]\hat{p}[/tex] = sample proportion
  • p = population proportion (hypothesised)

Then, the z test statistic for one sample proportion is:

[tex]Z = \dfrac{\hat{p} - p}{\sqrt{\dfrac{p(1-p)}{n}}}[/tex]

What are type I and type II errors?

The Type I error is false positive (returning the test result as positive, which means, rejecting the null hypothesis(conclusion of rejection of null hypothesis is called positive test result) when its incorrect).

The Type II error is false negative (returning the test result as negative, which means, accepting the null hypothesis(assuming negative test result, so no flaw in null hypothesis from the perspective of test) when its wrong).

For this case, we've got:

  • Assumption by manager = Population proportion of repurchase by customers > 0.4
  • Sample size = n = 90
  • Sample proportion of repurchase = 38/90 ≈ 0.422
  • Level of significance = α = 0.05

The hypotheses for test would be:

  • Null hypothesis: Manager is not correct(nullifies managers' assumption): [tex]H_0: p \leq 0.4[/tex] (p is population proportion of repurchasing customers)
  • Alternate hypothesis: Managers' assumption is true: [tex]H_1: p > 0.4[/tex]

It is single tailed.

At the level of significance 0.05, for single tail, the critical value of Z test statistic is found to be [tex]Z_{\alpha/2} = \pm1.645[/tex]

The z test statistic for one sample proportion is:

[tex]Z = \dfrac{\hat{p} - p}{\sqrt{\dfrac{p(1-p)}{n}}}[/tex]

We test null hypothesis, according to which p is 0.4 or less, so we get:

[tex]Z \approx \dfrac{0.422- 0.4}{\sqrt{\dfrac{0.4(1-0.4)}{90}}} \approx \dfrac{0.022}{\sqrt{0.00267}} \approx 0.426 < |Z_{\alpha/2}| = 1.645[/tex]

Thus, we accept the null hypothesis (we do so when [tex]Z < |Z_{\alpha/2}|[/tex] )

Therefore, there is not enough statistical evidence that the managers' claim is true.

Thus, here, we get:

  • Type I error: Rejecting the fact that manager's claim is wrong(and thus accepting that manager's claim is right) when actually manager's claim is wrong.
  • Type II error: Accepting the fact that manager's claim is wrong(and thus rejecting that manager's claim is right) when actually manager's claim is right.

Learn more about type I and type II errors here:

https://brainly.com/question/26067196