BA830 Assignment 2, Spring 2023: Rocket Fuel
Assignment 2 BA 830, Winter 2023
Assignment 2 BA830, Spring 2023 Due Date: February 2, 8am
Rocket Fuel (110 points) How long did this problem set take you in hours? How did you find the level of difficulty?
Instructions: Please use assignment2_notebook.qmd and rocketfuel_data.csv to do this assignment. REMINDER: Please label your answers when you submit the assignment on Gradescope. I will take points off if you don’t
Before you submit the pdf, please make sure that the text is readable and does not spill over the right side of the screen. To prevent this from happening, make sure to write your verbal answer outside of the code chunk.
Rocket Fuel (110 points) Please read the case about RocketFuel from the HBS Case Pack. For the assignment you need to read the Rocketfuel case, but answer the questions in the assignment. You can ignore the questions on the HBS website
Remember to write out your answers in words, don’t just output R statistics.
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ATE and statistical significance. a. What is the ATE (hat) of the ads on purchases (conversions)? (4 points) b. Is this difference statistically significant? Use the t.test function. (6 points) (You can use a two-sided test.)
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Was the campaign profitable? a. How much more profit did TaskaBella make by running the campaign (excluding advertising costs)? (8 points) Hint: The case contains some numbers that will allow you to do this calculation. b. What was the cost of the campaign? (8 points) Hint: The cost per thousand impressions is $9 c. Calculate the ROI of the campaign (including the control group). Was the campaign profitable? (8 points) d. What was the opportunity cost of including a control group; how much more could TaskaBella have made by not having a control group at all? (8 points)
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Did the number of impressions seen by each user influence the effectiveness of advertising? This figure plots the conversion rate by treatment group and by the number of impressions seen by users.
a. Based on the above figure, can we say that more impressions cause more conversions? (No more than 2 sentences) (8 points)
- Calculate the power of this experiment. a. Calculate cohen’s D. Cohen’s D, in this case, is the estimated average treatment effect on conversion divided by the standard deviation of conversion. (8 points) b. Use the pwr.t2n.test function, inputting the cohen’s d. (8 points) c. What would the power be instead if the true effect had a cohen's of .01? (4 points) d. What would the power be instead if the true effect had a cohen's of .01 and the sample was equally split between treatment and control? (4 points)
- Case Discussion in Class (20 points) Please write what you would discuss in your presentation to TaskaBella. Your answer should be one paragraph and the paragraph should be five or fewer sentences. Be prepared to discuss in class (part of the grade). Think about what is the most important thing to say to TaskaBella. No additional analysis is needed to answer this question.
How long did this problem set take you in hours? How did you find the level of difficulty?
