3. Customers at Bullseye are complaining that customers are abusing the 20 item-limit for self-checkout. Management
decides to investigate the complaints and randomly selects 367 customers utilizing self-checkout. It finds 11 purchased
more than 20 items.
(a) Estimate with 90% confidence the percent of all self-checkout customers that purchase more than 20 items.
(b) Explain the meaning of “90% confident.”
(c) What is the margin of error associated with the estimate? Explain its meaning.
(d) The general manager decides to dedicate an associate to enforce the regulation if there is evidence more than 3% of
customers are abusing the 20-item limit. What action does the interval suggest the GM should take?
(e) If management wants to estimate the true percent of shoppers that abuse the 20-limit item within 1.5 percentage
points at 90% confidence, what size sample should they use? Estimate the most conservative sample size.