Question: Kroger is trying to determine how profitable its loyalty program is . Two types of customers are those who joined the loyalty program ( called

Kroger is trying to determine how profitable its loyalty program is. Two types of
customers are those who joined the loyalty program (called loyals) and those who did
not (called non-loyals). The cost of serving a loyal customer per week is $10 greater
than that of serving a non-loyal customer. Kroger collected a sample of 100 customers
with 20 loyals and 80 non-loyals in it. The average weekly spending of loyal and non-
loyal customers in the sample is $110 and $80, respectively. The standard deviation of
spendings for loyal and non-loyal customers is $20 and $10 in the sample, respectively.
Given this information, is it profitable for Kroger to maintain a loyalty program

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