Question 6.127

6.127 Where do you buy?

Consumers can purchase nonprescription medications at food stores, mass merchandise stores such as Kmart and Walmart, or pharmacies. About 45% of consumers make such purchases at pharmacies. What accounts for the popularity of pharmacies, which often charge higher prices?

A study examined consumers’ perceptions of overall performance of the three types of store using a long questionnaire that asked about such things as “neat and attractive store,” “knowledgeable staff,” and “assistance in choosing among various types of nonprescription medication.” A performance score was based on 27 such questions. The subjects were 201 people chosen at random from the Indianapolis telephone directory. Here are the means and standard deviations of the performance scores for the sample:26

Store type
Food stores 18.67 24.95
Mass merchandisers 32.38 33.37
Pharmacies 48.60 35.62

We do not know the population standard deviations, but a sample standard deviation from so large a sample is usually close to . Use in place of the unknown in this exercise.

  1. What population do you think the authors of the study want to draw conclusions about? What population are you certain they can draw conclusions about?
  2. Give 95% confidence intervals for the mean performance for each type of store.
  3. Based on these confidence intervals, are you convinced that consumers think that pharmacies offer higher performance than the other types of stores? In Chapter 12, we study a statistical method for comparing the means of several groups.

6.127

(a) The ideal population is all nonprescription medication customers. The actual population consists of those listed in the Indianapolis telephone directory. (b) Food stores: (15.22, 22.12), Mass merchandisers: (27.77, 36.99), Pharmacies: (43.68, 53.52). (c) Yes, the confidence interval for the pharmacies gives values much higher than in the other two intervals.