MathCastle
Statistics & DataChallengeSampling Distributions

Sampling Distributions · Challenge problem

A buyer inspects a random sample of 100100 items from each large lot and rejects the lot if the sample proportion p^\hat p of defectives exceeds a cutoff cc. The cutoff is chosen so that a good lot, with 10%10\% defective, is rejected with probability 0.050.05 (use the normal model for p^\hat p with z=1.645z = 1.645). What is the probability that a bad lot, with 20%20\% defective, is ACCEPTED? Use the normal model again and give your answer to four decimal places.