Sale of Spinach That Is Contaminated with E Coli Can

question 46

Multiple Choice

Sale of spinach that is contaminated with e coli can cause food poisoning among consumers. A food inspector takes an SRS of 400 bags from all the bags of spinach shipped in one day. The laboratory reports that 19 of these bags had e coli contamination. Unknown to the producer, 1 percent of all bags shipped had e coli.
If the producer took an SRS of 200 bags instead of 400, the new margin of error would be:

• A) the same as before because the population of bags is the same.
• B) smaller than before because the sample is smaller.
• C) larger than before because the sample is smaller.
• D) random in size and could be either larger or smaller than before.
• E) impossible to determine because the size of the sample doesn't control the margin of error.

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Definitions:

Receiving Report

A document that records the details of goods received by a company, often used to verify deliveries and invoice payments.

Predetermined Overhead Rate

A predetermined overhead rate is an estimated rate used to assign overhead costs to products or job orders, based on a specific activity base.

Budget Data

Financial plans containing detailed projections of revenues and expenses for a future period, often used for management control and planning.

Factory Overhead

The indirect costs associated with manufacturing, including expenses like utilities and maintenance not directly tied to the production of goods.