Suppose that an IRS examiner correctly detects and flags 90% of all erroneous returns that he reviews. In addition, he mistakenly flags 2% of correct returns that he reviews. Suppose that about 20% of the tax returns he reviews contain errors. (a) What proportion of tax returns he reviews are flagged? (b) What proportion of tax returns he flagged actually contain errors?

Glencoe Algebra 1, Student Edition, 9780079039897, 0079039898, 2018
18th Edition
ISBN:9780079039897
Author:Carter
Publisher:Carter
Chapter10: Statistics
Section: Chapter Questions
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Suppose that an IRS examiner correctly detects and flags 90% of all erroneous returns that he reviews. In addition, he mistakenly flags 2% of correct returns that he reviews. Suppose that about 20% of the tax returns he reviews contain errors. (a) What proportion of tax returns he reviews are flagged? (b) What proportion of tax returns he flagged actually contain errors?
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