QUESTION A2: Are e-grocer sales profitable?
Companies that sell groceries over the internet are called e-grocers. Customers enter their orders, pay by credit card, and receive delivery by truck. A potential e-grocer analysed the market and determined that to be profitable the average order would have to exceed $85. To determine whether an e-grocery would be profitable in one large city, the service was offered to a random sample of customers and the size of the orders recorded in file ORDERS.xlsx. Can we infer from these data that an e-grocery will be profitable in this city?
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- One sample Z test is used when the sample size is large (> 30) or population standard deviation is known.
- Method of simple random sampling is used
- Data is normally distributed
Ho: population means is equal to μo. μ = μo
Ha3: population means is equal to μo. μ>μo (Right tailed test)
Here μ_o takes a particular value.
Test Statistic
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