Question

A retail analyst ran a promotional pricing experiment exclusively at three flagship stores located in affluent urban downtowns. The promotion increased average basket size by 18%, a statistically significant result. Leadership wants to roll the promotion out to all 400 stores nationwide, including rural and suburban locations, and expects the same 18% lift. What is the MOST important validity concern the analyst should raise?

Accepted Answer

External validity is limited because the sample stores are not representative of the full store population, so the 18% lift may not generalize

Answer

The p-value should be recalculated using a two-tailed test before results are trusted

Answer

Internal validity is compromised because no control group was mentioned in the experiment

Answer

The result is invalid because 18% is not large enough to justify a nationwide rollout