Supermarket Prices Essay Example | Topics and Well Written Essays - 1750 words

Supermarket Prices - Essay Example There are a lot of assumptions about the grocery market in Australia. One of the assumptions is that markets like the Coles and Woolworths have large economies of scale and hence they have cheaper products as compared to other supermarkets. It is also argued that different states have different market sizes, and costs resulting in different prices across the states. It is also assumed that the prices differ according to the location of the store. Further, managers at ALDI claims that they have different prices in the three states. Answer 1 Hypothesis: The null hypothesis is one in which we assume that the difference between the sample means is because of chance. The alternate hypothesis supposes that the samples are affected by some non-random clause (Prince, 2000). The Null hypothesis will be the one which assumes that the average price of all the stores is same. The alternate hypothesis will assume that there is significant difference between the average prices of the 4 supermarkets. Null Hypothesis: H0:  µ1 =  µ2 =  µ3 =  µ4 Alternate Hypothesis: H1:  µ1 ≠   µ2 ≠   µ3 ≠   µ4 Where,  µ1 is the average price at Coles/BI-LO  µ2 is the average price at Woolworths/Safeway  µ3 is the average price at independent stores  µ4 is the average price at ALDI Appropriate Test Since, we are required to compare the means of 4 samples; the appropriate test that shall be performed is the one-way ANOVA (Karris, 2003).