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Federal Trade Commission (FTC)

Hypothesis testing typically begins with a theory, a claim, or an assertion about a particular parameter (mean or proportion) of a population. The Federal Trade Commission (FTC) is an independent agency of the U.S. federal government charged with preventing unfair or deceptive trade practices. It regulates advertising, marketing, and consumer credit practices, and also prevents antitrust agreements and other unfair practices. The FTC publishes press releases regularly about health and fitness claims at https://www.ftc.gov/news-events/media-resources/truth-advertising/health-claims Health and Fitness Claims. Retrieved from https://www.ftc.gov/news-events/media-resources/truth-advertising/health-claims Find a claim about a product or service from one of the press releases listed in the FTC website. Read through these and select one of interest to you that has not been picked by anyone else yet in class. Initial Response: Formulating the Hypothesis Summarize the advertising claim as shared in the media. What population parameter is the claim about? (Hint: Focus on a population mean or proportion, such as the mean weight of a cereal box, or the proportion of fast-food orders filled correctly.) If you were to formulate a hypothesis test about this product/service, what would your null and alternative hypothesis be? (Be sure to use all the correct notations for Ho and Ha.) State whether you have a one-tailed or two-tailed test (Be sure you use the correct inequality signs).

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Hypothesis Testing

Claim: The claim is that Marketing Architects, Inc. (MAI) created and disseminated allegedly deceptive radio advertisement for weight-loss product. The MAI is accused for having created similar advertisement in the past for weight-loss marketers. It is alleged that the radio advertisement of the weight-loss product such as Final Trim and AF Plus were unsubstantiated or false (Katz, 2018). The MIA claimed that clients can take the weight-loss products as quite a bit of any food as they needed, and lose 10 to 20 pounds one week, without practicing and the weight reduction would be perpetual’. In this way, the mean week after week weight reduction at ‘Opportunity center against corpulence ‘would be 17.5 pounds, regardless of whatever food anybody expends.

The population parameter in claim is mean pound of weight lost, that is mu=17.5 pounds.

H0:mu=17.5 (mean weekly weight loss at ‘Freedom center against obesity’ is 17.5 pounds, irrespective of whatever food anyone consumes)

H1:mu=17.5 (mean weekly weight loss at ‘Freedom center against obesity’ is different than 17.5 pounds, irrespective of whatever food anyone consumes)

This is a two-tailed test.

Reference

Katz, J. M. (2018, February 6). Advertising Firm Barred from Assisting in the Marketing and Sale of Weight-Loss Supplements Deceptively Pitched to Consumer. Retrieved from Federal Trade Comission: https://www.ftc.gov/news-events/press-releases/2018/02/advertising-firm-barred-assisting-marketing-sale-weight-loss

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