In: Statistics and Probability
Based on sales over a six-month period, the five top-selling compact cars are Chevy Cruze, Ford Focus, Hyundai Elantra, Honda Civic, and Toyota Corolla (Motor trend, November 2, 2011). Based on total, the market shares for these five compact cars were Chevy Cruze 24%, Ford Focus 21%, Hyundai Elantra 19%, Honda Civic 18%, and Toyota Corolla 17%. A sample of 400 compact car sales in Chicago showed the following of vehicles sold:
Chevy Cruze | 108 |
Ford Focus | 92 |
Hyundai Elantra | 64 |
Honda Civic | 84 |
Toyota Corolla | 52 |
NOTE: Be sure to show X^2 and Xcrit^2, if not the p-value for test.
Use a goodness of fit test to determine if the sample data indicate that the market shares dor the five compact cars in Chicago are different that the market shares reported by Motor Trend. Using a .05 level significance. What is the p-value and what is your conclusion? What market shares differences, if any, exist in Chicago? please show the sample market share numbers with the difference
(a)
Calculation of observed value:
Name | Observed(O) | Expected (E) | (O - E)2/E |
Chevy Cruze | 108 | 400X24/100=96 | 1.5 |
Ford Focus | 92 | 400X21/100=84 | 0.7619 |
Hyndai Elantra | 64 | 400X19/100=76 | 1.8947 |
Honda Civic | 84 | 400X18/100=72 | 2 |
Toyota Corolla | 52 | 400X17/100=68 | 3.7647 |
Total = = | 9.9213 |
So,
Observed = 9.9213
(b)
ndf = 5 - 1 = 4
= 0.05
From Table, critical value of = 9.4877
Since the observed value of =9.9213 is greater than critical value of = 9.4877, the difference is significant. Reject Null Hypothesis.
Conclusion:
The data support the claim that the market shares for the five compact cars at Chicago are different than the market shares reported by Motor Trend.
(c)
Test statistic is:
= 9.9213
ndf = 4
By Technology, p-value = 0.0418
Since p-value = 0.0418 is less than = 0.05, the difference is significant as already concluded.
(d) Market share difference for each car is given below:
Name | Observed(O) | Expected (E) | Market Share Difference d = O - E |
Chevy Cruze | 108 | 400X24/100=96 | 12 |
Ford Focus | 92 | 400X21/100=84 | 8 |
Hyndai Elantra | 64 | 400X19/100=76 | - 12 |
Honda Civic | 84 | 400X18/100=72 | 12 |
Toyota Corolla | 52 | 400X17/100=68 | - 16 |