Answer: no; a 95% confidence interval for the proportion of bags in the shipment that are underweight is .006 TO .094 (5% plus or minus 4.4%). Since .10 (10%) IS NOT IN THIS INTERVAL, THE SHIPMENT IS NOT REJECTED.
Using one divided by the square root of the sample size is known as a ‘conservative’ formula for the margin of error for a sample proportion. Explain what that means.