Question

# You are hired by Google to research how much people are willing to pay for a new cell phone in US. They are

especially interested to know if their new phone, Pixel 3, should be priced similarly to Apple's iPhone Xs. Google believes that there is a difference between what Android and iPhone users are willing to pay for high-end phones. You are hired to answer this question.

Part I: To analyze iPhone users your team randomly selects 16 individuals. See attached data file.

a) Compute sample mean and sample standard deviation for iPhone users (use Excel Functions)

b) Compute 5-number summary for iPhone users (use Excel Functions)

c) Find the 90% confidence interval for the average phone price iPhone users are willing to pay.

Do computation by hand, using Table D.

Part II: To study Android users you collect data on 25 randomly chosen people. See attached data file

d) Compute sample mean and sample standard deviation for Android users (use Excel Functions)

e) Compute 5-number summary for Android users (use Excel Functions)

f) Find the 90% confidence interval for the average phone price that an Android user willing to pay. .

Do computation by hand, using Table D. How do you interpret it?

Part III: Hypothesis Testing g) Google executive believes that the price of the phone should be $780. Based on the data for Android users can you reject the executive's hunch that the price Android are willing to pay $780 against the alternative that it is not (two-sided alternative)? Google uses alpha (α) of 10%. Do computation by hand.

h) Test the hypothesis that the price iPhone users would pay for an iPhone is the same as the price of an Android user would pay for the phone, against the alternative that they are different (two-sided hypothesis). Google uses alpha (α) of 10%. (Hint: This is similar to the situation of comparing donut price in Chicago against NYC). Do computation by hand.

here is the data for the work.

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