Math

StatisticsQ&A LibraryWith the extra profits generated from the new customers, Jacobi is considering expanding his product range. He is interested in stocking a new type of motorcycle headset camera. To fit with current business plans, the new product would have to generate a minimum of 37.5% margin to be worthwhile. With that in mind, he hypothesizes that customers will be willing to pay at least $350 for this product, which is the minimum sale price for it to be viable at the specified margin. To test if his belief is true, Jacobi hires a market researcher (you) to determine how much customers may be willing to pay for this product. You collect data from a sample of 100 motorcycle enthusiasts, all of whom resemble Jacobi’s usual clientele, and determine that the average amount people are willing to pay is $364, with a standard deviation of $35. Using this information, you conduct a hypothesis test at a 5% level of significance to check whether Jacobi’s belief is justified and to help him decide whether to stock this product.Start your trial now! First week only $4.99!*arrow_forward*

Question

With the extra profits generated from the new customers, Jacobi is considering expanding his product range. He is interested in stocking a new type of motorcycle headset camera. To fit with current business plans, the new product would have to generate a minimum of 37.5% margin to be worthwhile. With that in mind, he hypothesizes that customers will be willing to pay at least $350 for this product, which is the minimum sale price for it to be viable at the specified margin.

To test if his belief is true, Jacobi hires a market researcher (you) to determine how much customers may be willing to pay for this product. You collect data from a **sample of 100 motorcycle enthusiasts**, all of whom resemble Jacobi’s usual clientele, and determine that the average amount people are willing to pay is $364, with a standard deviation of $35.

Using this information, you conduct a hypothesis test at a 5% level of significance to check whether Jacobi’s belief is justified and to help him decide whether to stock this product.

**Use excel to work this out**

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