Chapter 5.1, Problem 30E

To determine

To find out does the auditor have convincing evidence that the company’s claim is not true or not and design and carry out a simulation to answer.

Answer to Problem 30E

The auditor does not have convincing evidence that the company’s claim is not true.

Explanation of Solution

To carry out simulation, we should,

Use two-digit numbers.

Let the numbers $\text{00 to 89}$ represent that the train is on time.

Let the numbers between $\text{90 and 99}$ represent that the train is late.

Randomly select six numbers, with repetition allowed.

Count the number of times the train is late.

Repeat this simulation multiple times.

You will most likely obtain a result of between $\text{0 and 2}$ times that the train is late.

Thus they do not have convincing evidence that the company’s claim is not true.