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Confidence Intervals, Duality and the Bootstrap
Two variants report average revenue per user with 95% CIs: A: 4.10 (3.70, 4.50), B: 4.60 (4.15, 5.05). n = 2,000 per group. Revenue is zero for 90% of users and heavily right-skewed for the rest.
- A colleague says "the intervals overlap, so the difference is not significant." Evaluate this claim; compute the approximate CI for the difference and the corresponding p-value.
- State the duality between confidence intervals and hypothesis tests, and how you would use it to read the result in part 1.
- Given the skew and mass at zero, describe how you would compute a bootstrap CI for the difference in means and for the difference in medians, and comment on whether the median is a sensible metric here.
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