Question: It is often useful for retailers to determine why their potential customers choose to visit their store. Possible reasons include advertising, advice from a friend,
It is often useful for retailers to determine why their potential customers choose to visit their store. Possible reasons include advertising, advice from a friend, or previous experience. To determine the effect of full-page advertisements in the local newspaper, the owner of an electronic-equipment store asked 200 randomly selected people who visited the store whether they had seen the ad. He also determined whether the customers had bought anything, and, if so, how much they spent.
There were 113 respondents who saw the ad. Of these, 49 made a purchase. Of the 87 respondents who did not see the ad, 21 made a purchase. The amounts spent were recorded.
a. Can the owner conclude that customers who see the ad are more likely to make a purchase than those who do not see the ad?
b. Can the owner conclude that customers who see the ad spend more than those who do not see the ad (among those who make a purchase)?
c. Estimate with 95% confidence the proportion of all customers who see the ad who then make a purchase.
d. Estimate with 95% confidence the mean amount spent by customers who see the ad and make a purchase.
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