Creating set of observations from binomial distribution

Reference no: EM1313640

Q1) Assume you want to state that less than 0.5% (0.005) of your cables is defective.

a) How many observations should you take so that you can make use of normal approximation?

b) Create a set of n observations from the binomial distribution with 1 trial and the event probability of 0.007, where n is your answer from a.

c) By using normal approximation, compute test statistic and rejection criteria (by hand/calculator).

d) By using your answers to b, create a hypothesis test to find out if probability is equal to 0.005 or greater than 0.005. Provided that you know actual event probability.

Reference no: EM1313640

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