Question

Identify a quantitative variable (measurement) in your business/organization that has either interval or ratio level of measurement. Further, identify at least three meaningful groups into which this measure can appropriately be divided. Obtain at least 10 observations of this variable (measurement) from each of the identified groups.

Purpose: To demonstrate the application of ANOVA in business.

EXAMPLE: A standard measure that fits these requirements might be product assembly time (time is a ratio measure); three natural groups into which this measure can be divided might be day, evening, and night shifts. You can apply ANOVA hypothesis test to see if the average assembly time for a product is different among the three shifts. Conduct the ANOVA hypothesis test using your samples (observations for each group), discuss your findings in a short paragraph.

Answer 1

Let us take a scenario of sales of breads being manufactured by 3 methods . The data is given below

Method 1	method 2	method 3
45	73	101
51	78	98
49	83	105
58	75	111
55	77	100
50	83	108
47	80	115
62	70	110
46	79	104
53	81	109

To check whether the sales is affected by different preparation methods

Null Hypothesis H₀ : There is no significant difference in sales due to.different preparation methods (ie)

Alternative Hypothesis, H_a : There is significant difference in sales due to different preparation methods (ie)

Level of significance = 0.05

ANOVA Table

Since p value is less than level of significance , we reject H₀ and conclude that there is significant difference in sales of bread due to three different methods at 5 % level of significance