Possibility of using screening system


You've a supplier that historically has 2% defect rate. You're determining the possibility of using screening system. The candidate system will detect a flaw 95% of the time if there is a flaw. If there is no flaw, the system has a 1% false alarm rate. What is the probability that a product has a flaw if the system reports one? Is the screening system a good idea?

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Basic Statistics: Possibility of using screening system
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