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06 Sep 2004, 10:09
Kudos
Bookmarks
The product development team fro Piggy Bank was convinced by your presentation and has hired you to help them with their credit card decision. They have focused on three options for their credit card incentives:
A. cash back when the consumer makes an online purchase;
B. cash back when the consumer makes a purchase at a clothing store; and
C. entry into sweepstakes whenever the consumer makes a purchase.
If they choose option C (the sweepstakes entry), they will award a prize to 1 in 1,000 purchases. Based on the frequency that consumers make purchases with their other credit cards, the Piggy Bank team estimates that consumers will make an average of 52 purchases a year with
the new card
Piggy Bank has asked you about the probability of each option being preferred by card holders. They have also asked the probability of an individual consumer receiving a prize over the course of a year. Share your determination of probability in each of the situations. Explain how these two ways of assessing probability are different and how they can help make decisions
A. cash back when the consumer makes an online purchase;
B. cash back when the consumer makes a purchase at a clothing store; and
C. entry into sweepstakes whenever the consumer makes a purchase.
If they choose option C (the sweepstakes entry), they will award a prize to 1 in 1,000 purchases. Based on the frequency that consumers make purchases with their other credit cards, the Piggy Bank team estimates that consumers will make an average of 52 purchases a year with
the new card
Piggy Bank has asked you about the probability of each option being preferred by card holders. They have also asked the probability of an individual consumer receiving a prize over the course of a year. Share your determination of probability in each of the situations. Explain how these two ways of assessing probability are different and how they can help make decisions
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06 Sep 2004, 10:55
Kudos
Bookmarks
I think we still need to know how many online purchases he makes and how many clothing purchase he makes.
Archived Topic
Hi there,
This topic has been closed and archived due to inactivity or violation of community quality standards. No more replies are possible here.
Where to now? Join ongoing discussions on thousands of quality questions in our Quantitative Questions Forum
Still interested in this question? Check out the "Best Topics" block above for a better discussion on this exact question, as well as several more related questions.
Thank you for understanding, and happy exploring!
