Question

A salesman at a clothing store makes a sale to 30% of the customers he talks to, and wants to try out a new tecnique to see if he can change this rate. He decides to collect data for a few months on the percentage of customers he makes a sale to, and he is able to construct a 95% confidence interval of (.3095, .3275). Is there evidence at 5% significance that he has changed his average sales?

Answer 1

Yes, we can conclude that average sales has changed.

Explanation:

The null hypothesis, H0 : μ = 0.3

The alternative ; H0 : μ ≠ 0.3

The result of the 95% confidence interval of (.3095, .3275); This shows that the confidence interval is now between 30.95% and 32.75% ; since μ does not lie within the confidence interval value and the lower boundary of the confidence interval is > 30; we Can conclude with an evidence of 5% significance that his average sales as changed (increased).

We can reject H0 and conclude that μ > 0.3