Will improving customer service result in higher stock prices for the companies providing the better service? "When a company's satisfaction score has improved over the prior year's results and is above the national average (75.7), studies show its shares have a good chance of outperforming the broad stock market in the long run." The following satisfaction scores of three companies for the fourth quarters of two previous years were obtained from the American Customer Satisfaction Index. Assume that the scores are based on a poll of 61 customers from each company. Because the polling has been done for several years, the standard deviation can be assumed to equal 7 points in each case.
Will improving customer service result in higher stock prices for the companies providing the better service? "When a company's satisfaction score has improved over the prior year's results and is above the national average (75.7), studies show its shares have a good chance of outperforming the broad stock market in the long run." The following satisfaction scores of three companies for the fourth quarters of two previous years were obtained from the American Customer Satisfaction Index. Assume that the scores are based on a poll of 61 customers from each company. Because the polling has been done for several years, the standard deviation can be assumed to equal 7 points in each case.
MATLAB: An Introduction with Applications
6th Edition
ISBN:9781119256830
Author:Amos Gilat
Publisher:Amos Gilat
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Will improving customer service result in higher stock prices for the companies providing the better service? "When a company's satisfaction score has improved over the prior year's results and is above the national average (75.7), studies show its shares have a good chance of outperforming the broad stock market in the long run." The following satisfaction scores of three companies for the fourth quarters of two previous years were obtained from the American Customer Satisfaction Index. Assume that the scores are based on a poll of 61 customers from each company. Because the polling has been done for several years, the standard deviation can be assumed to equal 7 points in each case.
Transcribed Image Text:Will improving customer service result in higher stock prices for the companies providing the better service? "When a company's satisfaction score has improved over the
prior year's results and is above the national average (75.7), studies show its shares have a good chance of outperforming the broad stock market in the long run." The
following satisfaction scores of three companies for the fourth quarters of two previous years were obtained from the American Customer Satisfaction Index. Assume
that the scores are based on a poll of 61 customers from each company. Because the polling has been done for several years, the standard deviation can be assumed to
Glos
equal 7 points in each case.
ETT
Company
Year 1 Score
Year 2 Score
Rite Aid
77
78
Expedia
73
75
J.C. Penney
76
80
a. For Rite Aid, is the increase in the satisfaction score from Year 1 to Year 2 statistically significant? Use a = 0.05 and null hypothesis is Ho : µ1 – µ2 <0. Find the
test statistic and p-value. Use Table 1 of Appendix B.
z value
(to 2 decimals)
p-value
(to 4 decimals)
What can you conclude?
The difference
Select your answer - V statistically significant.
b. Can you conclude that the Year 2 score for Rite Aid is above the national average of 75.7? Use a = 0.05 and test the null hypothesis Ho : u < 75.7. Find the test
statistic and p-value. Use Table 1 of Appendix B.
z value
(to 2 decimals)
p-value
(to 4 decimals)
Transcribed Image Text:b. Can you conclude that the Year 2 score for Rite Aid is above the national average of 75.7? Use a = 0.05 and test the null hypothesis Ho : µ < 75.7. Find the test
statistic and p-value. Use Table 1 of Appendix B.
z value
(to 2 decimals)
p-value
(to 4 decimals)
What can you conclude?
We
- Select your answer - v that customer service has improved for Rite Aid.
c. For Expedia, is the increase from Year 1 to Year 2 statistically significant? Use a = 0.05 and test the null hypothesis Ho H1 - 42 <0. Find the test statistic and p-
value. Use Table 1 of Appendix B.
z value
(to 2 decimals)
p-value
(to 4 decimals)
C
What can you conclude?
The difference
Select your answer - v statistically significant.
d. When conducting a hypothesis test with the values given for the standard deviation, sample size, and a, how large must the increase from Year 1 to Year 2 be for it to
be statistically significant?
(to 2 decimals)
e. Use the result of part (d) to state whether the increase for J.C. Penney from year 1 to year 2 is statistically significant.
The increase
Select your answer
v statistically significant.
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