Formal Designs:

In formal designs the researcher randomly assigns treatments to randomly selected test units whereas in informal design careful assignment of treatments was not adopted. Thus statistical tests such as analysis of variance can be applied to the observation of formal designs, analysis of variance enables the researcher rousing an experiment on a sample to determine whether one treatment significantly influences another factor or whether the observed association could have been due to chance or some other factor.

Completely Randomized Design: The main feature of this design is that the experimental treatments are assigned to the test units completely at random. No prior precaution is needed to some extraneous variables before the assignments are randomly made. For example to study the various effects of different price levels for example three price all the retailers in the city will be divided into three categories at three levels . the total sales of each retailer of a particular price level are recorded and the effects of the price level are observed. Similarly the analysis of a product may require categorization of the retailers according to the nature of the products. The effectiveness of each product can be assessed accordingly.