Suppose that the probability of a defective part is .02. Suppose that you have a shipment of 200 parts. What is the probability that 5 or fewer parts will be defective?
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So, this involves calculating the probability using binomial distribution.
p(Defect) = .02
n = 200
The above parameters of binomial distribution are given below.
Why are we using binomial distribution? Because the outcome of this event is either a Success ( defect) , or a Failure ( not defect).
So, P(X<=5)
= BINOM.DIST(5, 200, 0.02, 1) [Excel formula calculates this, the function takes the parameters given in the formula]
= 0,7867
So, the probability that 5 or fewer parts are defective is .7867
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