When making decisions companies are always faced with decisi

When making decisions, companies are always faced with decisions that allow them to choose between two actions. Should a company open a new store in one neighboor hold and not the other? Should a company terminate a delivery contract for one company and get another? Is a new drug effective against a particular ailment? Such decisions require us to separate the population and compare 2 samples. Based on the results, we can now make a decision.

Describe an example of how we can use difference in population means in hypothesis testing before making a business decision. Please give an independent sample example and paired (related) sample. explain your selection.

Solution

Sol)

Dependent samples are paired measurements for one set of items. Independent samples are measurements made on two different sets of items.

When you conduct a hypothesis test using two random samples, you must choose the type of test based on whether the samples are dependent or independent. Therefore, it\'s important to know whether your samples are dependent or independent:

Example of collecting dependent samples and independent samples

Consider a drug company that wants to test the effectiveness of a new drug in reducing blood pressure. They could collect data in two ways: