It would appear that sufficient memory charms are cast to make the general population of Muggles sceptical of the occasional sighting of magic (or a magical beast) that somehow gets missed.
Per Fantastic Beasts and Where to Find Them
If any Muggle is unwise enough to confide in another that he has
spotted a Hippogriff winging its way north, he is generally believed
to be drunk or a “loony.” Unfair though this may seem on the Muggle in
question, it is nevertheless preferable to being burnt at the stake or
drowned in the village duckpond.
As to how the Wizarding World would respond, the answer is that the International Confederation of Wizards has regularly fined the British Ministry of Magic for failing to adequately deal with Muggle sightings of magic and magical creatures.
The International Confederation of Wizards has had to fine certain
nations repeatedly for contravening Clause 73*. Tibet and Scotland are
two of the most persistent offenders
*Each wizarding governing body will be responsible for the concealment, care, and control of all magical beasts, beings, and spirits dwelling within its territory’s borders. Should any such creature cause harm to, or draw the notice of, the Muggle community, that nation’s wizarding governing body will be subject to discipline by the International Confederation of Wizards.