1. Stine and Foster Question 16-43
Hotel Chain
Stine and Foster Question 16-43

2. Problem Statement
The management of a chain of hotels avoids intervening in the local management of its franchises unless problems become far too common to ignore. Management believes that solving the problems is better left to the local staff unless the measure of satisfaction drops below 33%. A survey of 80 guests who recently stayed in the franchise in St. Louis found that only 20% of the guests indicated that they would return to that hotel when next visiting the city. Should management intervene in the franchise in St. Louis?

3. Steps Determine Specify Sample Form Conclude
Determine the conditions in which no action will be taken
Specify
Specify the null hypothesis
Specify the alternative hypothesis
Sample
Sample and then use the resulting data to estimate the parameter of interest
Form
Form a test statistics
Determine the p-value of the test statistic
Conclude
Conclude with the course of action