When Working for the Brooklyn District Attorney, Investigator Robert Burton

question 59

Essay

When working for the Brooklyn District Attorney, investigator Robert Burton analyzed the leading digits of the
amounts from 784 checks issued by seven suspect companies. The frequencies were found to be
0, 18, 0, 79, 476, 180, 8, 23, and 0, and those digits correspond to the leading digits of 1, 2, 3, 4, 5, 6, 7, 8, and 9,
respectively. If the observed frequencies are substantially different from the frequencies expected with Benford's
Law, the check amounts appear to result from fraud. Use a 0.05 significance level to test for goodness-of-fit
with Benford's Law. Does it appear that the checks are the result of fraud?

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Definitions:

Factory Production

The process of manufacturing goods in bulk using machinery and assembly lines, typically within an industrial setting.

Redemptioners

Indentured families or persons who received passage to the New World in exchange for a promise to work off their debt in America.

Indentured German Families

German immigrants who came to America and worked for a fixed number of years in exchange for their passage, often in the 17th and 18th centuries.

Transportation Debt

The accumulated obligations incurred from funding the development, maintenance, and expansion of transportation infrastructure.