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An internal control policy for an online retailer requires a quality assurance check before a shipment is made. The tolerable exception rate for this internal control is 0.05. During an audit, 500 shipping records were sampled from a population of 6,000 shipping records. And 14 were found that violated the internal controls. Complete part (a) and (b).
a. Calculate the upper bound for a 90% one-sided confidence interval estimate for the rate of noncompliance.
b. Based on (a), what should the auditor conclude?
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