Question: Fast Grocery is a company that sells groceries over the internet. When a customer needs the service of Fast Grocery, she enters the order and pays using automatic funds transfer. Once the payment is approved the order is delivered within 24 hours. The company supplies groceries only to those customers who have registered with them for their service. There are 230 customers in the register. The data file, Sample Orders.xls gives a random sample of customer orders made last week. This data file gives the size of the order in $.

(a) What is the random variable of interest here?

(b) What is the most appropriate measure of central location here? Based on the information available to you what is your best estimate of the most appropriate measure of central location?

(c) Discuss briefly how the manager may use the information provided in part (b).

(d) What are the disadvantages in using the estimate provided in part (b)?

(e) Estimate with 95% confidence the mean order size.

(f) Interpret the answer to part (e).

(g) What are the assumptions that you made in answering part (e)?

The population data from which the random sample has been drawn is given in Population of Orders.xls file.

(h) Check the appropriateness (validity) of the assumptions stated in part (g).

Sample orders.xls