nstructions Questions from students – and answers One student asked: Dear professor: In exercise 8&9, Question 1, How can we calculate the RR without the Index to total or the Index to total without RR???? Answer Looking at the first figure in HW 8 – either reproduced here or look at the original exercise – take one example. You see the box on the left labeled “Last book order date within 18 months”. As you say, it has no RR and no index to total. But you can calculate other items around it. The keys are the total orders and total people (population) in each category. If you look at the those you can calculate the RR and Index to Total. For instance, for the whole sample, there is a 20,000 population with 5.25% response rate. This works out to 1050 orders. Please try it. Do you get the same? Now we don’t know the population of the box, “Last Book order date over 24 months ago.” But we do know the other populations and can do a subtraction of 20,000 – 4,567 – 7,623 = 7810 for a population of that. Since it has a 2.16% RR, we multiply to obtain ~168 order. Now we know the middle box has 473 orders (approx) because population of 7,623 * 6.20 % RR = 473 (rounded off). Now we can get the number of orders for the left hand box. Just simple subtraction. 1050 – 168 – 473 = 409. Finally get the response rate by dividing the 409 orders by 4.567 population to get 8.96% SO the “trick” is to first calculate the total populations and number of orders for each box, then calculate the RR from orders / population. Do you understand this? Please tell me ether way. This is very crucial to understanding all the math in the course. For instance, using what I have given you, what is the response rate for the box labeled: “Total book orders < 4" ? This is an important topic. Thanks for asking it. If you still need help, please contact me. -------------------------- Also Added spreadsheets. for the other examples ================================================= Another question and answer HW 8.6.c If asking for the % of new customer ordering, but then how do we know the new database size in terms of # of names? And do you derive the # of total orders. Answer OK - If you did part B before part C, you know the total names for the Super segment, for instance is 1409 (359+597+453 clear?) Also the orders for this segment 58 (=12+30+16 is the 2nd point clear?) From this you can easily figure the response rate and % of total. Multiply the RR by 20% for the new promotion as stated in the question. Now you can figure the other segments and which ones it pays to promote for. Now you can find the new number of people and number of orders for the full 10,000,000 person database. I am not sure the question specified the 10M. Perhaps a careful re-reading. But if not, you know it now. (updated in file Exercise 8 and 9_1)
