Consumer complaints - Statistical Methods for Business...

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Statistical Methods for Business Decision-Making Describing Data Exercise #1 (Consumer Complaints) Purpose: illustrate how the mean and standard deviation can answer important business questions. Instructions: Do this exercise in groups of two (or as homework.) You will only need a calculator for this exercise. 1. Read the exercise. 2. Use the Namias decision rule (explained below) to determine whether the observed rate is due to chance or whether it is due to some specific, unknown cause. The degree of sensitization on the part of a firm to the needs and wants of its consumers is frequently an important factor in determining the firm's overall success. J. Namias (1964) presents a procedure for achieving such sensitivity.* It uses the rate of consumer complaints about a product to determine when, and when not to, conduct a search for specific causes of consumer complaints. This rate may vary merely as a result of chance, or it may be due to some specific cause, such as a decline in the quality of the product. Concerning the former, Namias writes: In any operation or production process, variability in the output or product will occur,
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This note was uploaded on 11/15/2010 for the course ECO 6416 taught by Professor Staff during the Spring '08 term at University of Central Florida.

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Consumer complaints - Statistical Methods for Business...

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