ARD ERROR 14. Inspection sampling. A production process fills boxes with 20 ounces product with a standard deviation of 2 ounces, and the amount of prod. uct in each box tends to follow a normal distribution. (a) An inspector samples a random box and finds it contains 22 ounces of product. Is this unusually high? Explain. (b) Another inspector takes a random sample of one hundred boxes and finds an average of 22 ounces per box. Is this unusually high? Explain.29. Disability claims. In 2005 the Veterans Administration (VA) reported that the $25 billion in annual disability claims it pays had been rising steadily with post-traumatic stress disorder (PTSD) claims making up the bulk of the increase. The VA planned to review 72,000 such claims submitted by veterans between 1999 and 2004 because of concerns a large number may have been fraudulent. This would be an enormous task13. People's heights. People in a large population average 60 inches tall. You will take a random sample and will be given a dollar for each person in your sample who is over 65 inches tall. For example if you sample 100 people and 20 turn out to be over 65 inches tall, you get $20. Which is better: a sample of size 100 or a sample of size 1,000? Choose one and explain. Does the law of averages relate to the answer you give?22. Pharmaceutical product launch. A large pharmaceutical firm has do veloped a new drug and is scheduled to release it to the market at the end of next year. The profit it earns depends on whether or not it is the first firm to bring this type of drug to the market. The company is concerned because three other smaller competitors are independently working on similar drugs: the firm estimates that the first competitor has a 10% chance of bringing its drug to the market sometime before the firm's market release, the second competitor has a 15% chance, and the third competitor has a 5% chance. (a) What is the chance the large firm is the first to bring its drug to the market? (b) What is the chance the large firm is the last to bring its drug to the market?21. Credit default. A bank extends credit to five firms and assesses the risk. of default to be around a 5% chance for each firm. (a) If the firms each do business in independently operating sectors of the economy, estimate the chance at least one defaults. (b) If the firms each do business in the same sector of the economy, would the chance at least one defaults be larger than or smaller than your answer in (a)? Explain