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 (currently 76.2), 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 4th quarters of 2018 and 2019 were obtained from the American Customer Satisfaction Index. Assume that the scores are based on a poll of 70 customers from each company. Because the polling has been done for several years, the standard deviation can be assumed to equal 8 points in each case. Let 2018 be population 1. Company 2018 Score 2019 Score Rite Aid 74 77 For Rite Aid, is the increase in the satisfaction score from 2018 to 2019 statistically significant? Use α=0.05. What can you conclude?
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2. 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 (currently 76.2), 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 4th quarters of 2018 and 2019 were obtained from the American Customer Satisfaction Index. Assume that the scores are based on a poll of 70 customers from each company. Because the polling has been done for several years, the standard deviation can be assumed to equal 8 points in each case. Let 2018 be population 1. |
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Company |
2018 Score |
2019 Score |
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Rite Aid |
74 |
77 |
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For Rite Aid, is the increase in the satisfaction score from 2018 to 2019 statistically significant? Use α=0.05. What can you conclude?
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