Describe how you could use hypothesis testing to help make a decision in your current job, a past job, or a life situation. Include a description of the decision, what would be the null and alternative hypotheses, and how data could ideally be collected to test the hypotheses.
I have used hypothesis testing in my previous job as a marketing manager. My company wanted to increase sales through financing a new marketing campaign. The company wanted to use the campaign in one market segment to test the effects and started collecting data to see whether the campaign would had its desired impact. As the marketing manager, the goal was that company would only continue the new marketing campaign countrywide if believed sales would increase by more than 25%. In order to test the claim, I performed hypothesis testing on a sample data that had been gathered from the test market. The results were then analyzed and presented to help in determining whether to use the campaign countrywide.
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The first step in using hypothesis testing was to define the variables. Subsequently, I developed null and alternative hypothesis to analyze the validity of the claim in decision-making.
Null hypothesis: H0: The new marketing campaign would increase nationwide sales by 25%.
Alternative hypothesis: Ha: The new marketing campaign would not increase nationwide sales by 25%.
H0: µ= 25% versus Ha: µ? 25%
I considered two tailed test.
Here, we I used one sample t test for the population mean. I used use t test instead of z test because I did not have the information for the population standard deviation or process variation. So, by using collected sample data, I was could find out sample standard deviation S, sample mean Xbar, sample size n, degrees of freedom, among others. I considered 5% level of significance for this test. I used the following formula for the calculation of t test statistic.
Test statistic = t = (Xbar - µ) / [S/sqrt(n)]
By using this formula, I found out test statistic value. For this test statistic value, I found out p-value by using the t-table. If the pl-value was less than the 5% level of significance, then I would reject the null hypothesis and if p-value was greater than the 5% level of significance, then I will not reject the null hypothesis.
Describe how you could use confidence intervals to help make a decision in your current job, a past job, or life situation. Include a description of the decision, how the interval would impact the decision, and how data could ideally be collected to determine the interval.
Confidence interval helps us know if the sample static estimate the given population. It gives the range of values which will contain the population parameter. I have applied confidence interval previously in my last job, where I worked as a marketing representative with LG Electronics. We used confidence interval of 95% in determining whether the customers were interested in purchasing the new LG products which were being introduced in the new market. Higher values of the lower and upper bounds of the interval meant that more customers were interested in buying the products and thus, the company will likely sell those products in that market. The data to estimate the interval was collected by obtaining data of previous marketing campaigns for similar products by the same company in that market.
At 95% confidence level, I was 95% confident that the population parameter – that is, how many of the customers survey were willing to purchase the products versus how many customers actually bought the products – was in the obtained interval. Thus, I could conclude that there was only a 5% error chance.
Describe how you could use regression analysis to help make a decision in your current job, a past job, or a life situation. Include a description of the decision, what would be the independent and dependent variables, and how data could ideally be collected to calculate the regression equation.
Regression analysis is a mathematical formula of sorting out variables which have an effect. I used regression analysis in the company I worked as an assistance marketing manager in deciding which promotion strategies we would pursue and which would not. I took all of the business monthly sales numbers for the next six months. One situation was when we used regression analysis to evaluate whether internet marketing would increase the company’s sales by 10%.
Thus, the marketing department set out to find e average monthly sales for the next 6 months. The data was then plotted on a chart. The y-axis was the quantity of sales and the x-axis was the total amount of products sold after the introduction of the internet marketing strategy. Based on the sales realized, the marketing department them created a regression analysis equation for the data collected. For example, the equation was Y = 300 + 25x. Thus, when we used internet marketing, an average of 300 sales were made, and this was expected in the future, assuming other variables remained constant.
