Question 3.66

3.66 Price cuts on athletic shoes.

Stores advertise price reductions to attract customers. What type of price cut is most attractive? Market researchers prepared ads for athletic shoes announcing different levels of discounts (20%, 40%, or 60%). The student subjects who read the ads were also given “inside information” about the fraction of shoes on sale (50% or 100%). Each subject then rated the attractiveness of the sale on a scale of 1 to 7.

  1. There are two factors. Make a sketch like Figure 3.4 (page 144) that displays the treatments formed by all combinations of levels of the factors.
  2. Outline a completely randomized design using 50 student subjects. Use software or Table B at line 121 to choose the subjects for the first treatment.