Reference no: EM133340320

Questions:

1. As a Marketing researcher, you would like to establish the-cause-and-the-effect relationship between two variables X and Y (e.g., X causes Y). Explain why such a causal relationship is very hard to establish in the context of real data analysis .

2. Consider the "one-group pretest-posttest" experimental design denoted by O1XO2 where O1 is pre-measurement of Y, X is treatment, and O2 is post-measurement of Y. Explain why O2 - O1 may not be equal to the true treatment effect of X on Y.

2-1. Explain also how to improve the above experimental design.

3. Two microwave ovens, Emerson and Panasonic Regular, had been competing with each other and their market share were 57% and 43%, respectively. Emerson is 0.5 cubic feet and priced at $110, while Panasonic Regular is 0.8 cubic feet and priced at $180. Panasonic company introduced a new microwave oven model, Panasonic Premium, which is 1.1 cubic feet and priced at $200. After introduction of Panasonic Premium, the market share of Emerson decreases by 30% whereas that of Panasonic Regular increases by 17%. Explain why this may happen, using prospect theory.

4. Manufacturers of consumer packaged goods often adopt Hi-Lo pricing policy. That is, they set a regular price for their products, maintain it in most times, and offer price discounts temporarily. So the resulting pricing pattern is that high and low prices alternate over time. One of the potential drawbacks of this Hi-Lo pricing is that it makes consumers more deal-prone if temporary price discounts are offered too often. Explain why this may happen.