Smith and Smith are Certified Public Accountants who are in love with statistical analysis for audit sampling because of its objectivity and precision.  They made an estimation of expected population deviation of their client’s accounts receivable to be 2.1% . However, they seem to have a rough idea that the sample is representative of the population and that its deviation approximates that of the population deviation.   They decided to set their sample deviation parameters at + 3 or – 3% Required: a. What will be the sample risk deviation tolerable at the lowest limit level for your audit? The total Accounts Receivable is $500,000.00. This is the assertion by management. b. What will be the sample risk deviation that is tolerable at the highest level?

A drug company claims that their products’ contaminations never vary by more than 2%. Sample of 5 specimens were tested and the percentages of the purities are recorded as Observation no. 1 2 3 4 5 Percentages (%) 98.8 97.2 98.9 97.7 97.9 a. Do the sample data have enough proof to oppose the manufacturer's claim? (HINT: take the range of 2% equal 4o.) b. Find a 90% confidence interval for o?.

In this problem, assume that the distribution of differences is approximately normal. Note: For degrees of freedom d.f. not in the Student's t table, use the closest d.f. that is smaller. In some situations, this choice of d.f. may increase the P-value by a small amount and therefore produce a slightly more "conservative" answer.   Are America's top chief executive officers (CEOs) really worth all that money? One way to answer this question is to look at row B, the annual company percentage increase in revenue, versus row A, the CEO's annual percentage salary increase in that same company. Suppose a random sample of companies yielded the following data:   B: Percent increasefor company 24 25 23 18 6 4 21 37 A: Percent increasefor CEO 21 23 22 14 −4 19 15 30   Do these data indicate that the population mean percentage increase in corporate revenue (row B) is different from the population mean percentage increase in CEO salary? Use a 5% level of significance. (Let d = B −…

The head of a computer science department is interested in estimating the proportion of students entering the department who will choose the new computer engineering option. A preliminary sample indicates that the proportion will be around 0.35. Therefore, what size sample should the department head take if she wants to be 95% confident that the estimate is within 0.10 of the true proportion?