Question
Jan Villaroel
Topic: Statistics Posted 11 months ago
An article titled "The Discipline of Business Experimentation" provides several examples of randomized experiments in the context of making business decisions.

An article titled "The Discipline of Business Experimentation" provides several examples of randomized experiments in the context of making business decisions. In one such experiment, the retailer Kohl's decided to test whether
opening stores an hour later would lead to a significant decrease in sales. The experiment involved 100 of the
company's stores, which were divided into two groups. One group of stores opened an hour later than usual. The other
group continued with regular store hours. The experiment did not find a meaningful difference in sales between the
groups of stores. Explain why it is important that the company use random assignment to create the two experimental
groups.

(a) If the groups were not randomly assigned, Kohl's employees would be upset that they were not given fair
treatment.
(b) Business decisions should only be made after a randomized experiment has been conducted. This is the
only way to prove if opening the store earlier will be effective.
(c) Random assignment allowed the researchers to use blinding and thus the employees were not aware of
which experimental condition they were assigned to.
(d) Random assignment allows the researcher to create groups that are equivalent. This ensures that the
experiment does not favor one experimental condition over another


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Koala Tutor
Dec 26, 2023
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(d) Random assignment allows the researcher to create groups that are equivalent. This ensures that the experiment does not favor one experimental condition over another. Random assignment helps to eliminate confounding variables and ensures that any differences observed between the two groups can be confidently attributed to the manipulation of the independent variable (opening stores an hour later). This helps to establish a cause-and-effect relationship between the independent variable and the outcome (sales).

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