“Made in the USA” survey. Refer to the Journal of Global Business (Spring 2002) study of what “Made in the USA” on product labels means to the typical consumer, presented in Exercise 2.13 (p. 36). Recall that 106 shoppers participated in the survey. Their responses, given as a percentage of U.S. labor and materials in four categories, are summarized in the accompanying table. Suppose a consumer advocate group claims that half of all consumers believe that “Made in the USA” means “100%” of labor and materials are produced in the United States, one-fourth believe that “75 to 99%” are produced in the United States, one-fifth believe that “50 to 74%” are produced in the United States, and 5 percent believe that “less than 50% are produced in the United States.
Response to “Made in the USA” | Number of Shoppers |
100% | 64 |
75 to 99% | 20 |
50 to 74% | 18 |
Less than 50% | 4 |
Source: ‘“Made in the USA’: Consumer perceptions, deception and policy alternatives,” Journal of Global Business, Vol. 13, No. 24, Spring 2002 (Table 3).
a. Describe the qualitative variable of interest in the study. Give the levels (categories) associated with the variable.
b. What are the values of p1, p2, p3, and p4, the probabilities associated with the four response categories hypothesized by the consumer advocate group?
c. Give the null and alternative hypotheses for testing the consumer advocate group’s claim.
d. Compute the test statistic for testing the hypotheses stated in part c.
e. Find the rejection region of the test at α = .10.
f. State the conclusion in the words of the problem.
g. Find and interpret a 90% confidence interval for the true proportion of consumers who believe that “Made in the USA” means that “100%” of labor and materials are produced in the United States.
Exercise 2.13
“Made in the USA” survey. “Made in the USA” is a claim stated in many product advertisements or on product labels. Advertisers want consumers to believe that their product is manufactured with 100% U.S. labor and materials—which is often not the case. What does “Made in the USA” mean to the typical consumer? To answer this question, a group of marketing professors conducted an experiment at a shopping mall in Muncie, Indiana. (Journal of Global Business, Spring 2002.) They asked every fourth adult entrant to the mall to participate in the study. A total of 106 shoppers agreed to answer the question, “‘Made in the USA’ means what percentage of U.S. labor and materials?” The responses of the 106 shoppers arc summarized in the following table:
a. What type of data collection method was used?
b. What type of variable, quantitative or qualitative, was measured?
c. Present the data in the table in graphical form. Use the graph to make a statement about the percentage of consumers who believe that “Made in the USA” means 100% U.S. labor and materials.
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