2. A national manufacturer of baby food was planning to enter the Canadian market. The initial thrust was to be in the provinces of Ontario and Quebec. Prior to the final decision of launching their product, management decided to test-market the products in two cities. After reviewing the various cities in terms of external criteria such as demographics, shopping characteristics, and so on, the research department settled on the cities of Hamilton, Ontario, and Sherbrooke, Quebec.

a. What type of sampling method was used?

b. Critically evaluate the method used.

3. The Wisconsin National Bank, headquartered in Milwaukee, Wisconsin, has some 400,000 users of its credit card scattered throughout the state of Wisconsin. The application forms for the credit card asked for the usual information on name, address, phone, income, education, etc. The bank is now very much interested if there are any demographic differences between heavy and light users of the credit card. Light users and those who use the card for few transactions, and heavy users make frequent transactions.

a. Identify the population and sampling frame that would be used by Wisconsin National Bank.

b. Indicate how you would draw a stratified sample from the above sampling frame.

c. Indicate how you would draw a simple random sample from the above sampling frame.