2. An inspector for the IRS is auditing a mid-sized firm. She only has half a da

Question

2. An inspector for the IRS is auditing a mid-sized firm. She only has half a day to go through all the books and decides to inspect a sample of the invoices to see if she should start a fraud investigation (which would free up additional auditing resources). As a first step, she pulls 300 invoices at random for further inspection. 12 of these show inaccuracies. 4. The IRS agent wants to report the 99.5% confidence interval for the proportion of incorrect invoices. Should she use a z-table or t-table, and what z or t-value should she use?

Explanation / Answer

. The IRS agent wants to report the 99.5% confidence interval for the proportion of incorrect invoices. Should she use a z-table or t-table, and what z or t-value should she use?

we are goin to use Z value because this is a proportion problem , so we know that the behavior is normal so we are going to use Z value , also the sample size is bigger than 30

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