9 Hypothesis Testing

Hypothesis Testing

Overview

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Clothing Store Sales

Thinking of working in retail? It would benefit you to learn your statistics well because retail stores are learning how to leverage the information about their customers into greater sales and healthier bottom lines. Our Chapter 9 Case Study, Clothing Store Sales, examines the purchasing behavior of 5000 customers of a large clothing retail store in the Northeast, over a period of six months. The data set, Clothing Store, is excerpted from a case study in Data Mining and Predictive Analytics, by Daniel Larose and Chantal Larose (Wiley, 2015). We use this clothing store sales data to help us learn about hypothesis testing.

In the Section 9.1 exercises, we pose a series of business research questions to be turned into hypotheses.
Through two examples in Section 9.2, we learn how to perform a $Z$ test for $μ$ , using the critical-value method, to determine if the population mean sales per customer is greater than the district manager's goal of $413 per customer.
In the Section 9.2 exercises, we perform a $Z$ test for the population mean number of coupons used per customer.
We perform a $Z$ test for $μ$ , the population mean number of items purchased per customer, in the Section 9.3 exercises.
In the Section 9.4 exercises, we explore whether the mean number of days since the last customer visit is as small as the marketing manager wants.
Finally, in the Section 9.5 exercises, we examine the proportion of customers who have ever bought a blouse and the proportion of customers who have ever bought a suit.

THE BIG PICTURE

Where we are coming from and where we are headed …

Chapter 8's topic, confidence intervals, represents only the first of a large family of topics in statistical inference.
Hypothesis testing is the most widely used method for statistical inference, forming the bedrock of the scientific method, and touching nearly every field of scientific endeavor, from medicine to business to psychology. It is also the basis for business-oriented decisionmaking methods. Here, in Chapter 9, we learn how to perform hypothesis tests for the population mean, the population proportion, and the population standard deviation.
In Chapter 10, “Two-Sample Inference,” we will learn confidence intervals and hypothesis tests for comparing parameters from two populations.