Basic Marketing Research 7th Edition by Gilbert Churchill,Tom Brown,Tracy Suter

Exercise 5

Plaza AutoMall is a medium-sized automobile dealership located in a small city in the southeastern United States. The dealership sells and services new and pre-owned automobiles. In recent months, revenues from the automotive servicing side of the business have been flat, while revenues from new car sales have been rising. The owner suspects that part of the service and repair business may have shifted to a new auto repair shop that opened about a year ago on the other side of town. The new repair shop is much more conveniently located for consumers who live on that side of town. To better understand the perceptions and behaviors of the dealership's customer base (i.e., those who had purchased a car from the dealership) regarding auto servicing, the owner brought in a team of researchers. The researchers developed a mail questionnaire that asked respondents the percentage of times they use Plaza AutoMall for auto repairs (assessed on a 0% to 100% scale). The researchers also coded the return envelopes so that they could deter-mine in which section of town the respondent resides (the city can easily be divided into three well-defined areas, which the researchers coded A, B, and C). The questionnaire was sent to a random sample of the dealership's customer base. Mean scores on the de-pendent variable were as follows: region A (where the dealership is located) = 93; region B = 82; and region C (where the competing auto repair shop is located) = 70. The researchers utilized the analysis of variance technique to determine if the difference in these means is statistically significant, producing the following ANOVA table:

a. Assuming = 0.05, can the researchers reject the null hypothesis of no difference across groups Why or why not
b. Suppose that the researchers were willing to change the level of significance to = 0.15; would your answer to part (a) change What would be the consequences for Type Ierror Explain.