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BA 376 Project Assignments

[Tatag Adi Sasono]

Reviewed by:
[Reviewer #1 Tiradah Hasanah]
[Reviewer #2 Bunga Azalea Putri]

BA 376

Project #1: Tests of Goodness of Fit & Independence

[October 10, 2017]

[Professor Olstad]

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BA 376 Project Assignments

Part I: Data, Approach and Statistical Tool Selection.

The data is categorized as quantitative data that collected from match sample method as it measures by
grouping of households. The data is generating by quantifying the qualitative data from the 93-survey
respondent conducted by My Cable TV. The method of quantifying data is by generating survey then giving
satisfaction level and range for the variables.

The research question are does the gender affect to the reasonable price of My Cable TV service? Does
the proportion of men and women who answered 5,6, &7 significantly difference to the reasonable price?
Does the respondent zip code contribute to the reasonable price of My Cable TV service?

There are 12 categorical variables. First is the variable of price (Q1) shows the level of cable TV service
price that reasonable by the respondent. The range is between 1 (strongly disagree) to 7 (strongly agree).
The variable of value (Q2) shows the level of satisfaction from watching TV shows that customer has been
paid. The range is between 1 (strongly disagree) to 7 (strongly agree). The variable of variety (Q3) shows
the level of satisfaction of TV programs. The range is between 1 (very poor) to 7 (really great). The variable
of kinds (Q4) shows the level of TV shows option that can watch. The range is between 1 (not many) to 7
(very many). The variable of reliability (Q5) shows the reliable performance from the service. The range is
between 1 (strongly disagree) to 7 (strongly agree). The variable of working (Q6) indicates the stability of
TV’s cable. The range is between 1 (strongly disagree) to 7 (strongly agree). The variable of satisfaction
(Q7) indicates the overall judgement become customer of My Cable TV. The range is between 1 (strongly
disagree) to 7 (strongly agree). The variable of loyalty (Q8) indicates the willing of customer to continue
using the My Cable TV services. The range is between 1 (definitely no) to 4 (absolutely yes). The variable
of package (Q9) indicates the willing to subscribe the latest voice, internet, and cable (3-in-1) package.
The choice is between “yes” (1) and “no” (2). The variable of gender (Q10) indicates the customers gender.
The choice is “male” (0) and “female” (1). The variable of zip (Q11) indicates the zip code. There are three
choices, 97201, 97219, and 97221. The last variable is age (Q12) indicates the customer’s age. The are five
range starting from 18-24 (1), 25 – 34 (2), 35 – 49 (3), 50 – 60 (4), and 61 and over (5).

This quantitative data appropriate to be analyzed using chi-squared test because to compare survey data
that has been observed with the data that user expect to obtain relating to specific hypothesis. It designs
to test whether the null hypothesis should be rejected or not. Thus, the independent correlation of the
data can be generated through test of independence.

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BA 376 Project Assignments

Part II: Gender vs. Price

Number of observations 93 Hypothesis of Gender v Price


Number of rows (Price) 7 H0 Gender and price are independent
Number of columns (Gender) 2 H1 Price is not independent of the gender

Frequency Table for Price by Gender Tests of Independence


Price Gender Row Test Statistic Df P-Value Alpha
0 1 Total Chi-Square 7.464 6 0.2801 5%
(Male) (Female) Conclusion The result is not significant as the P-Value of
1 1 5 6 0.280 is greater than or equal to 0.05. We should
2 4 9 13 not reject the null hypothesis. It means that the
3 4 6 10 gender is independent of the price. Thus, there will
4 12 15 27
be no any correlation and affect on gender to
5 9 10 19
reasonable price service by My Cable TV.
6 5 4 9
7 7 2 9
Column 42 51 93
Total
Difference of Two Proportions – Men v Women

Hypothesis of Two Proportion Test of Hypothesis


H1 P1 – P2 = 0 Sample proportions = 0.5 and 0.314
H2 P1 – P2 ≠ 0 Sample sizes = 42 and 51

Approximate 95.0% confidence interval for difference between


Proportion Calculation proportions: [-0.0117139,0.383714]
Men 𝑝1 (9 + 5 + 7)
𝑝1 =
̅̅̅ = = 0.5 Null Hypothesis: difference between proportions = 0.0
𝑛1 42 Alternative: not equal
Computed z statistic = 1.82365
Women 𝑝2 (10 + 4 + 2) P-Value = 0.0682047
𝑝2 =
̅̅̅ = = 0.314 Result: The P-Value of 0.0682047 is higher than or equal to
𝑛2 51 0.05 indicates that the unable to reject the null hypothesis.
Thus, these two proportion are not identical.

Conclusion
These two results are not identical because the null hypothesis cannot be rejected. Then, the proportion of
men and women are different. At the chi-square test of independence measures all the variables of price. Yet,
it difference while measuring the two proportion test only using the data of men and women who answered
the price of 5, 6, and 7. In the genders agreement categories proportion, men is answering higher to the price
of 5,6,&7 than women. Therefore, the genders do not affect the reasonable price service by My Cable TV as it
shows by the chi-square test of independence.

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BA 376 Project Assignments

Part III: Zip code vs. price

Number of observations 93 Hypothesis of Zip Code v Price


Number of rows (Price) 7 H0 Zip code and price are independent
Number of columns (Zip Code) 3 H1 Price is not independent of the zip code

Frequency Table for Price by Zip

Price Zip Code Row Total


201 219 221
1 3 2 1 6
2 7 2 4 13
3 5 2 3 10
4 9 0 18 27
5 8 4 7 19
6 3 4 2 9
7 5 2 2 9
Column Total 40 16 37 93
Percentage 43.01% 17.20% 39.78% 100.00%
Conclusion The 201 zip code has higher percentage of 43.01%
in fulfill the survey conducted by My Cable TV
rather than zip code of 221(39.78%) and 219
(17.20%).

Tests of Independence
Test Statistic Df P-Value Alpha
Chi-Square 19.106 12 0.0860 5%
Conclusion The result is not significant as the P-Value of 0.0860 is greater than or equal to 0.05. We
cannot reject the null hypothesis. From that, it indicates that the zip code is independent
to the reasonable price of My Cable TV service. As consequences, there is no correlation
and effect on zip code to the reasonable price by My Cable TV.

Conclusion
Eventually, the price question as categorical variable is reasonable. In the categorical variable it describes
as ordinal variable. It means that the observer can modify the data of agreement level of reasonable service
price by ranking or ordering from the higher to lower like strongly disagree (1) to strongly agree (7). It does
not need to establish a numeric difference between each category.
Reflection
By studying this exercise, I expect to be able to solve the problem of measuring qualitative data using
quantitative data method. It means that, I want to analyze the goodness of fit and independent of the variable
that I have expected to measure. It will increase the accuracy of the decision by knowing the proportion of
percentage each variable and p-value whether to reject null hypothesis or not. As a future businessman, I
must apply this exercise to know the exact customers and product’s demand in the market.