Business owners like to know how their decisions will affect their business. Before making decisions, owners may explore the benefits of hypothesis testing. By making such tests, they can have more...

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Business owners like to know how their decisions will affect their business. Before making decisions, owners may explore the benefits of hypothesis testing. By making such tests, they can have more confidence in their decisions.


One example is Joe Smith who is testing to see whether the company's gym shoe will have a significant difference on weight loss. If the company markets this shoe and finds that it does not cause weight loss as expected, they may want to consider their marketing strategy or dropping the campaign all together. What is a scenario of how hypothesis testing can be used in the business world? Looking back on your scenario, what decisions can managers make to help improve their company. When it comes to relating sample results to the population, can we make our decisions using the sample value?







Answered Same DayMay 02, 2021BUS201

Answer To: Business owners like to know how their decisions will affect their business. Before making...

Rajeswari answered on May 04 2021
113 Votes
Decision making and hypothesis testing:
Any business is a profit seeking institution and hence the peo
ple at top level are constantly worried about improvement of sales, retention of good customers ensuring good quality, market prices of competitive products, cost reduction techniques etc.
In this scenario, Mr. Joe Smith, a manufacturer of gym shoes wants to test whether his shoes shows any significant difference on weight loss compared to other shoes. If this does not differ, the management wants to consider either marketing strategy or dropping the plan.
This can be done first for a sample of individuals preferably selected at random from difference gym centres of different sex, culture, eating habits, etc. They will be given this shoes and checked their weight loss in a month and again in the following month other brand shoe will be given and weight loss will be recorded.
Now we have a pair of set of observations for the same individuals by using this gym shoe and also by using other market shoe. The exercise...
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