UNIT 3: INDIVIDUAL PROJECT 1

Unit 3: Individual Project

Applied Managerial Decision Making

Darlenzo Hines

11/13/2022
UNIT 3: INDIVIDUAL PROJECT 2

Unit 3: Individual Project

Introduction

There are numerous ways Big D can assist the outdoor sporting goods client chose if they

should maintain their current position or expand to a new market in Chicago. For this case, Big

D will rely on data related to the products and location of the outdoor sporting goods client to

help them make a sound decision. Evidently, in last week’s task, Big D was not in a position to

analyze data from both Chicago and America. The company’s business analyst found it hard to

make a comparison between the markets of Outdoor Sporting Goods Company in Chicago and

America. However, this week, Big D has identified some statistical testing tools they can use to

help their client reach a sound decision. Drawing from Ranganathan (2021) performing statistical

tests improve chances for reaching quantitative decision about processes. It achieves this by

determining if there is sufficient evidence to disprove or reject a hypothesis about a process.

For this task, the statistical tool that Big D will use to assist it advice its client is the Chi-

Squared test. A Chi-squared test is normally a statistical hypothesis test utilized in analyzing

contingency tables in events of large sample sizes. In simpler terms, Chi-Squared test is basically

utilized in examining if two categorical variables influence the test statistic independently

(Singhal & Rana, 2015). To perform an effective Chi-Squared test, it will be advisable to include

all the factors that are directly related to Outdoor Sporting Goods Company’s expansion. These

include ethnicity and race, marital status, and educational attainment. Other factors include the

per capita income, household income, and labor force.

As observed in the 2000 Census, the levels of educational attainment were high in

Chicago. However, there were high rates of unemployment despite the strong labor force and
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high per capita income. Analyzing these variables along with the ones mentioned earlier will

assist in determining if the Outdoor Sporting Company should expand its operations in Chicago

or not.

Since there are insufficient data to formulate a full chi-square for the client, this task

defines a Chis-Square test that utilizes the null and alternative hypothesis with two different

product lines: indoor and outdoor sporting frequencies as provided in the assignment details

section. The null hypothesis revealed that there were no discernable or significant differences in

the frequency of indoor and outdoor sporting. On the other hand, the alternative hypothesis

presented also revealed that there were no major differences between indoor and outdoor

sporting frequencies. The demographics that were taken into account when reaching the

decisions were the marital status, ethnicity or race, and education.

When making a comparison between Chicago and the rest of America using 2000 Census

data, it is evident that the people in Chicago with associate degree stood at 1.90%, which was

way below that of America at 6.32%. The census also depicted that the national average graduate

degree holders were 15.54%, while that for Chicago was 33.9%. These percentages illustrated

that Chicago was fit for expansion owing to the high literate labor force. The number of married

persons were also high in Chicago at 54.20%. This figure is significantly high compared to that

of the US at 27.10%.

Based on the null and alternative hypothesis, as well as the information presented above,

Big D should advice the Outdoor Sporting Client to expand to Chicago. Furthermore, Chicago

also has a high disposable income and a high average income. The results of the Chi-Square

were 95 signifying the rejection of the null hypothesis.

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References
Ranganathan P. (2021). An Introduction to Statistics: Choosing the Correct Statistical

Test. Indian journal of critical care medicine: peer-reviewed, official publication of

Indian Society of Critical Care Medicine, 25(Suppl 2), S184–S186.

https://doi.org/10.5005/jp-journals-10071-23815

Singhal, R., & Rana, R. (2015). Chi-square test and its application in hypothesis testing. Journal

of the Practice of Cardiovascular Sciences, 1(1), 69. https://doi.org/10.4103/2395-

5414.157577