Beruflich Dokumente
Kultur Dokumente
Business Case # 1
Tests of Hypotheses
GENERAL DIRECTIONS: Provide your answers in typewritten format printed in short bond
papers, using font style Times New Roman, font size 12, and 1.5 line-spacing. Use PHStat2 to
answer the following questions and be able to provide outputs to support your answers
PAR, INC.
Par, Inc. is a major manufacturer of golf equipment. Management believes that Pars
market share could be increased with the introduction of a cut-resistant, longer-lasting golf ball.
Therefore, the research group at Par has been investigating a new golf ball coating designed to
resist cuts and provide a more durable ball.
One of the researchers voiced concern about the effect of the new coating on driving
distances. Par, Inc. would like the new cut-resistant ball to offer driving distances comparable to
those of the current-model golf ball. To compare the driving distances for the two balls, 40 balls
of both the new and current models were subjected to distance tests. The testing was performed
with a mechanical hitting machine so that any difference between the mean distances for the two
models could be attributed to a difference in the two models. The results of the tests, with
distances measured to the nearest yard, are given in the Golf.xlsx file.
MANAGERIAL REPORT:
1.) Formulate and present the rationale for a hypothesis test that Par, Inc. could use to compare
the driving distances of the current and new golf balls.
2.) Provide descriptive statistical summaries of the data for each model.
3.) Analyze the data to provide the hypothesis testing conclusion. Use a 5% level of significance.
What is the p-value for your test? What is your recommendation for Par, Inc.?
SUBMISSION DEADLINE: October 7, 2015 (C35); October 8, 2015 (C34)
( X 1X 2 ) X 0
S 2p
1
1
+
n1
n2
2
p
and S =
( n1 1 ) S 21+( n21 ) S 22
n1+ n22
The critical value approach tells us to reject the null hypothesis in favor of the alternative
hypothesis if: tstat -t/2,n1+n22 = -t0.025,78 = -t1.9908
Or if tstat t/2,n1+n22 = t0.025,78 = t1.9908
In the sample data given, we were able to derive the following:
Sample mean
0
0.05
40
270.275
8.7529848
40
267.5
9.8969045
39
39
78
87.2817
2.0890
2.7750
1.3284
Two-Tail Test
Lower Critical Value
Upper Critical Value
p-Value
Do not reject the null hypothesis
-1.9908
1.9908
0.1879
To summarize the results, we do not reject the null hypothesis. Since we were able to derive
tstat = 1.3284, 1.3284 is not less than -1.9908, or greater than 1.9908. Therefore we do not reject
the null hypothesis.
Not surprisingly, the decision is also the same using the p-value approach, which is reject null
hypothesis if p = 0.05. Therefore, because p = 0.1879 is not less than = 0.05, we do not
reject the null hypothesis. There is sufficient evidence at the = 0.05 level to conclude that the
average driving distance of the old model golf ball is comparable to the average driving distance
of the new-model golf ball.
After the conclusion, my recommendation for Par, Inc. is to continue making a new model-golf
ball with a coating designed to resist cuts and a more durable ball. Since after the test we were
able to find out that the driving distance of the new-model golf ball is still comparable to the old
model golf ball. Furthermore, it is believed that the market share of the company could be
increased with the introduction of the new golf balls.