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Confidence Interval: Proportion of Drug Test

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As a condition of employment, Fashion Industries applicants must pass a drug test. Of the last 220 applicants 14 failed the test. Develop a 99 percent confidence interval for the proportion of applicants that fail the test. Would it be reasonable to conclude that more than 10% of the applicants are now failing the test? In addition to the testing of applicants, Fashion Ind. randomly tests its employees throughout the yr. Last year in the 400 random tests conducted, 14 employees failed the test. Would it be reasonable to conclude that less than 5% of the employees are not able to pass the random drug test?

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Solution Summary

The solution provides step-by-step method for the calculation of confidence interval for population proportion. Formula for the calculation and Interpretations of the results are also included. Interactive excel sheet is included. The user can edit the inputs and obtain the complete results for a new set of data.

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