When a store uses electronic article surveillance (EAS) to combat shoplifting, it places a small sensor on each item of merchandise. When an item is legitimately purchased, the sales clerk is supposed to remove the sensor to prevent an alarm from sounding as the customer exits the store. In an actual survey of 250 consumers, 40 said that if they were to set off an EAS alarm because store personnel (mistakenly) failed to deactivate merchandise, they would never shop at that store again. A company marketing the alarm system claimed that no more than 5 percent of all consumers would say that they would never shop at that store again if they were subjected to a false alarm.
a. Assuming that the company’s claim is valid, use the normal approximation to the binomial to calculate the probability that at least 40 of the 250 randomly selected consumers would say that they would never shop at that store again if they were subjected to a false alarm.
b. Do you believe the company’s claim based on your answer to part a? Explain.