A firm is considering using the Internet to supplement its traditional sales methods. Using data from an industry association, the firm estimates that 1 of every 1,000 Internet hits results in a sale. Suppose the firm has 2,500 hits per day.
a. What is the probability that the firm will have more than five sales in a randomly selected day?
b. What conditions must be satisfied in order for you to make the calculation in part (a)?
c. Use the Poisson approximation to compute the probability that the firm will have more than five sales in a randomly selected day.
d. Is the Poisson approximation accurate?