A small maker of video games designs a pricing experiment. They know that some teens self-identify as ?gamers,? while others do not. They market a

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A small maker of video games designs a pricing experiment. They know that some teens self-identify as ?gamers,? while others do not. They market a new video game to gamers and non-gamers, and they send half of each group a rebate worth $10. The results are plotted below.

a) At a company meeting, management says that the data show that rebates work. Is this interpretation correct? Why or why not?

b) Is there an interaction effect? How do you know?

c) Would the rebate strategy be better targeted at gamers or non-gamers?

d) Does this experiment satisfy the principles necessary for a properly designed experiment?

e) Is this experiment double-blind?

120 Rebate 100 80 No Rebate 60 40 20 NonGamer Gamer Gaming status Sales (units, 000s)