Ex 8. An airline's data indicate that 50 percent of people who begin the online process of booking a flight never complete the process and pay for the flight. To reduce this percentage, the airline is considering changing its website so that the entire booking process, including flight and seat selection and payment, can be done on two simple pages rather than the current four pages. A random sample of 300 customers who begin the booking process are exposed to the new system, and 117 of them do not complete the process.

Managerial Economics: A Problem Solving Approach
5th Edition
ISBN:9781337106665
Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Chapter17: Making Decisions With Uncertainty
Section: Chapter Questions
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Ex 8. An airline's data indicate that 50 percent of people who begin the online process of booking
a flight never complete the process and pay for the flight. To reduce this percentage, the airline is
considering changing its website so that the entire booking process, including flight and seat
selection and payment, can be done on two simple pages rather than the current four pages. A
random sample of 300 customers who begin the booking process are exposed to the new system,
and 117 of them do not complete the process.
a. Formulate the null and alternative hypotheses needed to attempt to provide evidence that
the new system has reduced the noncompletion percentage.
b. Use critical values to perform the hypothesis test by setting α equal to .10, .05, .01, and .001

Expert Solution
Step 1

We have sample and its results as

Sample size n=300

And x=117

We can find out the p, by sing the given information.

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