10.00 points Exercise 8.10 ADVERTISING n an article in Marketing Science, Silk a

Question

10.00 points Exercise 8.10 ADVERTISING n an article in Marketing Science, Silk and Berndt investigate the output of advertising agencies. They describe ad agency output by finding the shares of dollar billing volume coming from various media categories such as network television, spot television, newspapers, radio, and so forth a Suppose that a random sample o 390 US. advertising agencies gives an average percenta e share of b lin Volu me mn orkte e s one u alto·45 cen , and assume na is .4 percent. Calculate a 95 percent confidence interval for the mean percentage share of billing volume from network television for the population of all U.S. advertising agencies. (Round your answers to 3 decimal places.) The 95 percent confidence interval is (b) Suppose that a random sample of 390 U.S. advertising agencies gives an average percentage share of billing volume from spot television commercials equal to 12.42 percent, and assume that o equals 1.57 percent. Calculate a 95 percent confidence interval for the mean percentage share of billing volume from spot television commercials for the population of all U.S. advertising agencies. (Round your answers to 3 decimal places.) The 95 percent confidence interval is [ (c) Compare the confidence intervals in parts a and b. Does it appear that the mean percentage share of billing volume from spot television commercials for U.S. advertising agencies is greater than the mean percentage share of billing volume from network television? Explain (Click to select) confidence interval in (b) is totally (Click to select)the confidence interval in (a).

Explanation / Answer

Confidence Interval = X-bar +/- Z*Alpha/n

a) X-bar = 7.45

Z = For 95% confidence interval, Z value equals 1.96

Alpha = 1.48

n = 390

CI = 7.45 +/- 1.96*1.48/390 = 7.45 +/-0.007 = 7.443, 7.457

b) X-bar = 12.42

Z = For 95% confidence interval, Z value equals 1.96

Alpha = 1.57

n = 390

CI = 12.42 +/- 1.96*1.57/390 = 12.42 +/-0.007 = 12.412, 12.428

c) Yes, the mean percentage billing from spot commercial television is greater than that of billing volume from network television as the CI of spot commercial television is on higher side.

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