Question

1. A manager in a rapidly growing industry wishes to study the effects of motivation on sales in particular firm. Traditionally, all sales staff has been salaried. Senior management has been most reluctant to change the existing system. Within his own branch, however, the manager wishes to gather evidence on whether or not to pay commissions to salespersons. Of 24 new salespersons, 12 are paid an hourly rate and 12 are paid a commission. The 24 individuals are randomly assigned to the two groups. The following data represent the sales volume (in thousands of dollars) achieved during the first month on the job.

Hourly	Commission
256	224
239	254
222	273
207	285
228	237
241	277
212	261
216	228
236	234
219	225
225	232
230	245

1. Is there evidence that commission and hourly rate sales differ? Use Excel, a = .01, and the p-value approach to answer this question. Attach your Excel analysis to your assignment answers.                                                                  10 marks

1. Hyps: H₀:

H₁:

2. Test(s):

3. Analysis:

p-value:

4. Conclusions: (1)

(2)

(3)

(4)

b)What assumptions must be made in part (a) of this problem?

Answer 1

Solution:

H0: There is no evidence that the commission and hourly rate sales differ. That is,

H1: There is evidence that the commission and hourly rate sales differ. That is,

Conclusion :

1) p- value >

2) H0 is not rejected at 0.01 level of significance

3) There is no evidence that the commission and hourly rate sales differ.

4)

b. Assumptions for part (a)

1) The parent populations from where the two samples are taken, are normal.

2) The variances of both the samples are unknown.

3) The two population variances are unequal.

Thank You.

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