Estimate the Indicated Probability by Using the Normal Distribution as an Approximation

question 14

Multiple Choice

Estimate the indicated probability by using the normal distribution as an approximation to the binomial distribution.
-A product is manufactured in batches of 120 and the overall rate of defects is 5%. Estimate the probability that a randomly selected batch contains more than 6 defects.

• A) 0.0832
• B) 0.4168
• C) 0.5871
• D) 0.4641

Understand the principles of Just-In-Time (JIT) processing and its benefits.

Recognize how a process cost system functions and the role of a production cost report.

Apply cost accounting principles in JIT and traditional process costing environments.

Understand the concept of equivalent units in process cost accounting.

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Definitions:

Parity Price

A price level that ensures the purchasing power of a commodity is maintained relative to an index or standard, often used in agricultural policy.

Base Period

A specific time period against which economic indicators or financial indexes are measured to assess changes over time.

Index of Prices

A statistical measure that shows changes in the price level of a selected basket of goods and services over time.

Farm Product

Products that are derived from agriculture, including both crops and livestock.