Question
An accounting firm is interested in estimating the error rate in a compliance audit it is conducting. The population contains 828 claims, and each claim
An accounting firm is interested in estimating the error rate in a compliance
audit it is conducting. The population contains 828 claims, and each claim
consists of 215 fields. The firm audits 85 claims selected using SRSWOR,
and all 215 fields are checked for errors for each selected claim. It is found
that one claim has error in 4 of the 215 fields, one claim has three errors, 4
claims have two errors, 22 claims have one error, and the remaining 57
claims have no errors.
(i) Treating this as one stage cluster sampling, estimate the error rate for
all 828 claims. Give a standard error for your estimate.
(ii) Estimate (with standard error) the total number of errors in the 828
claims. (iii) Suppose, instead of taking a cluster sample, the firm takes 85215
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