One division of a large defense contractor manufactures telecommunication equipment for the military. This division reports that 12% of non-electrical components are reworked. Management wants to determine if this percentage is the same as the percentage rework for the company’s electrical components. The Quality Control Department plans to check a random sample of the over 10,000 electrical components manufactured across all divisions. The 95% confidence interval based on this data is .0758 to .1339. Should management conclude that the percentage of rework for electrical components is lower than the rate of 12% for non-electrical components?

At the 95% confidence level, management should not conclude that the percentage of rework for electrical components is lower than the rate of 12% for non-electrical components, since the upper bound of the confidene interval, which is 0.1339, is higher than 0.12.

Step-by-step explanation:

To reach a conclusion, we have to observe the confidence interval.

Should management conclude that the percentage of rework for electrical components is lower than the rate of 12% for non-electrical components?

Is the upper bound of the confidence interval lower than 12% = 0.12?

If yes, it should conclude that this percentage is lower.

Otherwise, it cannot conclude.

Confidence interval:

0.0758 to 0.1339

0.1339 is higher than 0.12.

So.

At the 95% confidence level, management should not conclude that the percentage of rework for electrical components is lower than the rate of 12% for non-electrical components, since the upper bound of the confidene interval, which is 0.1339, is higher than 0.12.

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