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AlphaCo takes customer service seriously. Recently the operations department has been pushing for a proposal to increase the investment in finished product inventory to improve

AlphaCo takes customer service seriously. Recently the operations department has been pushing for a proposal to increase the investment in finished product inventory to improve after sales service. The argument is that with a higher level of available finished products, the operations department can easily do replacement for faulty products and thus improve after sales service. However, investment in inventory should be considered cautiously as capital tied up in inventory normally generates lower return than investment in other assets. AlphaCo's management wants to find out if the operations department's hypothesis can be supported by the collected data. You are tasked to perform an association analysis according to the following requirements.

(i) Use an appropriate chart type to examine the relationship between the two variables. Provide a brief justification of your choice. What can you observe and conclude from the chart? (ii) Use an appropriate statistical tool to examine the relationship between the two variables. Clearly present the steps and components of the tool (if any), as well as the result of analysis. What can be concluded from the analysis? Is the conclusion consistent with the observations and conclusions in (b)(i)? (iii) Is it possible to establish a causality between inventory level and after sales service, i.e., increase in inventory level improves/deteriorates after sales service, based on the conclusion in (b)(i) and (b)(ii)?

Data:

Week Inventory (units) Complaint (cases)
1 3221 37
2 3236 40
3 3279 45
4 3400 43
5 3409 39
6 3426 39
7 3374 51
8 3214 43
9 3345 43
10 3554 45
11 3731 59
12 3836 57
13 4209 41
14 4190 51
15 4259 49
16 4266 52
17 4271 46
18 4194 48
19 4095 45
20 3904 47
21 3791 46
22 3746 43
23 3899 45
24 4190 44
25 4539 41
26 4586 45
27 4541 49
28 4524 55
29 4505 54
30 4464 54
31 4251 51
32 3896 48
33 3659 44
34 3570 42
35 3839 40
36 4106 38
37 4491 33
38 4424 39
39 4385 41
40 4404 49
41 4361 49
42 4286 48
43 3999 45
44 3740 41
45 3389 40
46 3336 37
47 3581 37
48 3944 35
49 4185 32
50 4084 35
51 4071 37
52 4086 38
53 4129 39
54 3910 40
55 3539 39
56 3406 38
57 3181 37
58 3204 35
59 3365 34
60 3524 33

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