Customers who made online purchases last quarter from an Internet retailer were randomly sampled from the retailer’s database. The dollar value of each customer’s quarterly purchases along with the time the customer spent shopping the company’s online catalog that quarter were recorded. The sample results are contained in the file Online.
a. Create a scatter plot of the variables Time (x) and Purchases (y). What relationship, if any, appears to exist between the two variables?
b. Compute the correlation coefficient for these sample data. What does the correlation coefficient measure?
c. Conduct a hypothesis test to determine if there is a positive relationship between time viewing the retailer’s catalog and dollar amount purchased. Use a level of significance equal to 0.025. Provide a managerial explanation of your results.