1. GranPrixAuto Bank is a national provider of automobile loans, insurance, and credit services focusing on the driving public and automobile owners. The company currently offers a credit card with no specific benefits to its customers. It has tested on a small scale a new credit card that, upon the payment of a yearly $30 membership fee, will provide a 2% discount on gasoline purchases and hotel stays at participating hotels and gas stations. This new offer has been promoted to a select group of new account applicants and also promoted to existing credit card customers. Since its introduction early in the year, 839 customer accounts for this new offer have been created. The average monthly balance on these cards is $1,229 (standard deviation of $394). The management believes that this credit card can result in an increase in credit card spending; it cites the fact that, for a randomly selected sample of 1,000 of its traditional customer accounts, the average monthly balance is only $1,121 (standard deviation of $291). In your opinion, is their observation correct or not? What reservations might you have on making such an assessment?