A Company That Manufactures Tubeless Tires Sampled 342 Tires from a Day's

question 64

Multiple Choice

A company that manufactures tubeless tires sampled 342 tires from a day's production of 27,114 tirts. Seven tires in the sample were found to be defective. Select the most believable conclusion.

• A) About 2.047% of the day's production was defective.
• B) Of the 27,114 tires produced that day, 555 were defective.
• C) A little over 2% of all tires produced by the plant that day were defective.
• D) A little over 3% of all tires produced by the plant that week were defective.

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Definitions:

Hidden Action

A situation in principal-agent relationships where the agent's actions are not fully observable by the principal, potentially leading to agency problems.

Hidden Characteristic

A quality of a product or service that is not immediately observable to the buyer, often leading to information asymmetry in the market.

Transitive

In logic and mathematics, transitive refers to a relation where if it applies between successive pairs in a sequence, it also applies between any two members taken in order. For example, if A is larger than B, and B is larger than C, then A is larger than C.

Preferences

Indications of the choices or selections made by individuals or groups based on tastes, likes, or desires, often influencing decision-making.