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A laptop manufacturing company has implemented a 2-step process to test the quality of each production batch. In the first step, a technician randomly selects 15 laptops from the batch and determines whether they meet specifications. The batch is considered acceptable provided no more than 1 laptop fails to meet specifications. Otherwise, the entire batch has to be tested in the second step. Historical data shows that 95% of the laptops produced adhere to specifications.
-Can we use a binomial distribution to model this process?
-What is the probability that the entire batch unnecessarily has to be tested if, in fact, 95% of its laptops conform to specifications? (Hint: Use Excel's =BINOMDIST() function to find the probability)
-What is the probability that the batch is incorrectly accepted if only 75% of its laptops actually conform to specifications?
-What situations in your organization might this type of analysis apply to? Explain.
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