A manufacturer conducted a pricing experiment to explore the effects of price decreases on sales of one

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A manufacturer conducted a pricing experiment to explore the effects of price decreases on sales of one of its breakfast cereals. The two largest supermarket chains in a particular area participated in the experiment. Ten stores from each chain were randomly selected, and each store was assigned a price level for the cereal (either the original price or a 10% reduced price). If the competing chain had a store in the sail vicinity, the two stores both were assigned the same price level. Some stores failed tc complete the experiment due to competition from other supermarkets chains. Sales volumes (in hundreds of units) over the period of the study were noted for each oft remaining 17 stores and are shown in the following table.

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a. Using the accompanying SAS computer output, conduct a two-way ANOVA with Chain and Price as factors. (Provide the Fstatistic values and P-values in the accompanying ANOVA table as part of your analysis.)
b. Do the effects of a price decrease on sales volume significantly differ between the different chains? If not, does it appear that a price decrease will significantly increase sales volume? How do the sales volumes compare at the two chains? Report your conclusions using the α = .05 level. Also, do the conclusions differ for the different approaches taken in parts (a) and (b)?
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Applied Regression Analysis And Other Multivariable Methods

ISBN: 632

5th Edition

Authors: David G. Kleinbaum, Lawrence L. Kupper, Azhar Nizam, Eli S. Rosenberg

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