Question

A retailer wants to see if a red "sale" sign brings in more revenue than the same "sale" sign in blue. the data below shows the revenue in thousands of dollars that was achieved for various days when the retailer decided to put the red "sale" sign up and days when the retailer decided to put the blue "sale" sign up. red: 2.3, 3.7, 4.5, 5.4, 2, 1.3, 3.3, 2.3 blue: 2.2, 2.7, 3, 2.4, 2.5, 1.5, 0.2, 2.1, 3.8, 2 assume that both populations follow a normal distribution. what can be concluded at the = 0.01 level of significance level of significance?

Answer 1

To determine if a red 'sale' sign brings in more revenue than a blue 'sale' sign, we can perform a two-sample t-test. This test will allow us to compare the mean revenue for the two sign colors and determine if there is a significant difference.

Step-by-step explanation:

To determine if a red 'sale' sign brings in more revenue than a blue 'sale' sign, we can perform a hypothesis test. Let's use a two-sample t-test to compare the mean revenue for the two sign colors.

Step 1: Set up the null and alternative hypotheses:

• H0: The mean revenue for red 'sale' sign = the mean revenue for blue 'sale' sign
• Ha: The mean revenue for red 'sale' sign > the mean revenue for blue 'sale' sign

Step 2: Choose a significance level, α. In this case, α = 0.01.

Step 3: Calculate the test statistic and p-value using the provided data. Once the test statistic and p-value are obtained, we can compare the p-value to α. If the p-value is less than α, we reject the null hypothesis; otherwise, we fail to reject the null hypothesis.

Step 4: Make a conclusion based on the comparison of the p-value and α.