A small company decides to offer a new online shopping feature. The company’s pr
ID: 3260489 • Letter: A
Question
A small company decides to offer a new online shopping feature. The company’s president wants to offer a free gift card to customers who make a $200 minimum purchase online. These customers can choose any one of three different gift cards of equal value. A month after starting this promotion, it is found that 40 customers selected a restaurant gift card, 29 of them selected a grocery store gift card, and 33 of them selected a movie theater gift card. Using a significance level of 0.05, test the claim that the three gift cards being offered in this promotion are equally popular.
Identify the value of the TEST STATISTIC used in a hypothesis test of the claim.
Identify the value of the CRITICAL VALUE used in a hypothesis test of the claim.
Find the value of the P-VALUE that would be used in a hypothesis test of the claim. Identify the CONCLUSION of a hypothesis test of the claim.
Explanation / Answer
Ans:Chi square test:
H0:three gift cards being offered in this promotion are equally popular.
H1 :three gift cards being offered in this promotion are not equally popular. cted count
Expected count=(40+29+33)/3=102/3=34
Test statistic:
Calculated Chi square score=1.82
Critical value approach:
Critical chi square score for 0.05 significance level and df=3-1=2 is:
Critical Chi square score=5.99
As,Calculated chi square score=1.82<critical chi square score=5.99,We fail to reject null hypothesis.
p-value approach:
p-value=0.4025
As,p-value>0.05,we fail to reject null hypothesis.
There is sufficient evidence to support the claim that the three gift cards being offered in this promotion are equally popular.
Observed(O) Expected(E) (O-E)^2/E 1 40 34 1.06 2 29 34 0.74 3 33 34 0.03 Total= 102 102 1.82