Question

A direct mail company wishes to estimate the proportion of people on a large mailing list that will purchase a product. Suppose the true proportion is 0.03. If 384 are sampled, what is the probability that the sample proportion will be less than 0.05? Round your answer to four decimal places.

Answer 1

Solution

Given that,

p = 0.03

1 - p = 1-0.03=0.97

n = 384

= p =0.03

=  [p ( 1 - p ) / n] =   [(0.03*0.97) / 384 ] = 0.008705

P( <0.05 ) =

= P[( - ) / < (0.05-0.03) /0.008705 ]

= P(z <2.30 )

Using z table,   

=0.9893

probability =0.9893