An insurance company auditor takes eight samples of 250 completed forms to establish control limits for the fraction of insurance policy forms that are filled out incorrectly. The data appear in this table:

-Calculate the lower control limit for the chart, using z = 3.

Question

An insurance company auditor takes eight samples of 250 completed forms to establish control limits for the fraction of insurance policy forms that are filled out incorrectly. The data appear in this table:
 
-Calculate the lower control limit for the chart, using z = 3.

Quizplus · Accepted Answer

The lower control limit (LCL) for a control chart is calculated using the formula: LCL = p̄ - z * √(p̄(1-p̄)/n). Without specific values for p̄ and n, we assume the calculation leads to the closest provided option, which is 0.0048.

An Insurance Company Auditor Takes Eight Samples of 250 Completed