Question: Among its other features the MyTVLab website allows customers to

Among its other features, the MyTVLab website allows customers to purchase MyTVLab LifeStyles merchandise online. To handle payment processing, the management of MyTVLab has contracted with the following firms:
• PayAFriend (PAF)— This is an online payment system with which customers and businesses such as MyTVLab register in order to exchange payments in a secure and convenient manner, without the need for a credit card.
• Continental Banking Company (Conbanco) — This processing services provider allows MyTVLab custom-ers to pay for merchandise using nationally recognized credit cards issued by a financial institution.
To reduce costs, management is considering eliminating one of these two payment systems. However, Lorraine Hildick of the sales department suspects that customers use the two forms of payment in unequal numbers and that ­customers display different buying behaviors when using the two forms of payment. Therefore, she would like to first determine the following:
• The proportion of customers using PAF and the proportion of customers using a credit card to pay for their purchases.
• The mean purchase amount when using PAF and the mean purchase amount when using a credit card.
Assist Ms. Hildick by preparing an appropriate analysis. Open Payments Sample. pdf, read Ms. Hildick’s comments, and use her random sample of 50 transactions as the basis for your analysis. Summarize your findings to deter-mine whether Ms. Hildick’s conjectures about MyTVLab LifeStyle customer purchasing behaviors are correct. If you want the sampling error to be no more than $3 when estimating the mean purchase amount, is Ms. Hildick’s sample large enough to perform a valid analysis?

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  • CreatedJuly 16, 2015
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