In: Statistics and Probability
A study of the relationship between facility conditions at gas stations and aggressiveness in the pricing of gasoline reports the accompanying data based on a sample of n = 385 stations.
Table of Observed counts
Observed pricing policy
Aggressive Neutral Nonaggressive
Condition Standard 52 73 80
Modern 58 86 36
a. What is the expected cell count table under the null hypothesis that the facility conditions and the aggressiveness of the pricing are independent?
b. Carry out a chi-square test for the independence. What is the value of test statistic?
c. What is the reject region for the significance level 0.01? Does the data suggest that facility conditions and pricing policy are independent of one another?