Lets say you work in a metropolitan city for a large departm

Let\'s say you work in a metropolitan city for a large department store chain and your manager puts you in charge of a team to find out whether keeping the store open an hour longer each day would increase profits. What data might be available to your decision-making process? What data would be important to your decision?

Solution

The data that might be available for my decision making process are data sets with regards to attendance, sales, profitability and customer feedback (i.e. whether they would be willing to come and shop during the extended hour or not).

To make my decision that data sets that will be important are review of past trends that will help me determine the correlation between profitability (dependent variable) and the number of hours the store is opened (independent variable). It has to be kept in mind that keeping the store open for an additional hour will also lead to incremental costs in the form of extra overheads and variable costs. By doing a review of past trend we can forecast incremental profits. If only incremental profits from keeping the store open for an additional hour is greater than the incremental costs the store should be kept open for the proposed additional hour, otherwise it should not be considered.