SOLUTION: As a condition of employment, Fashion Industries applicants must pass a drug test. Of the last 220 applicants 14 failed the test. Develop a 99% confidence interval for the portion

Question 526469: As a condition of employment, Fashion Industries applicants must pass a drug test. Of the last 220 applicants 14 failed the test. Develop a 99% confidence interval for the portion of applicants that fail the test. Would it be reasonable to conclude that more than 10% of the applicants are now failing the test?
Answer by stanbon(75887) (Show Source): You can put this solution on YOUR website!
As a condition of employment, Fashion Industries applicants must pass a drug test. Of the last 220 applicants 14 failed the test. Develop a 99% confidence interval for the portion of applicants that fail the test. Would it be reasonable to conclude that more than 10% of the applicants are now failing the test?
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p-hat = 14/220 = 0.06
ME = 2.5758*sqrt[0.06*0.94/220] = 0.04
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99% CI: 0.06-0.04 < p < 0.06+0.04
99% CI: 0.02 < p < 0 10
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p > 10% is not in the 99% confidence interval.
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Cheers,
Stan H.
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