Suppose you work for a company that manufactures electronics. The development analysts estimate that 5% of their flagship product will fail within 2 years of the purchase date, with a replacement cost of $ 1200. A newly hired associate at the company proposes to charge $ 50 for a 2-year warranty. 1. Compute the expected value of this proposal. Let X be the amount profited or lost (by the company) on the warranties and P(X) is the probability. 2. Interpret the expected value in complete sentences.

Answers

Answer 1
I’m not sure but I tried
Answer 2

The expected value of the proposal is -$10. This means that, on average, the company can expect to lose $10 per warranty sold.

Interpretation of the expected value:

The expected value of -$10 indicates that, on average, for every 2-year warranty sold, the company can expect to lose $10. This means that the proposal is not a profitable venture for the company. The replacement costs of the 5% of failed products are higher than the revenue generated by selling the warranties and cannot cover the potential losses.

To compute the expected value of the proposal, we need to calculate the amount profited or lost (X) by the company on the warranties and the probability (P(X)) of each outcome.

Now, we have,

The product doesn't fail within 2 years, and the company earns $50 from the warranty.

The product fails within 2 years, and the company incurs a replacement cost of $1200 but keeps the $50 warranty fee.

The probability of the product not failing within 2 years is 1 - 0.05 = 0.95,

and the probability of the product failing within 2 years is 0.05.

Now, we have to find the expected value (E(X)):

[tex]E(X) = P(X_1) * X_1 + P(X_2) * X_2[/tex]

Where:

[tex]P(X_1)[/tex] = Probability of the product not failing within 2 years = 0.95

[tex]X_1[/tex] = Amount profited when the product doesn't fail within 2 years = $50

[tex]P(X_2)[/tex] = Probability of the product failing within 2 years = 0.05

[tex]X_2[/tex] = Amount lost when the product fails within 2 years = -$1150 (Replacement cost of $1200 - $50 warranty fee)

E(X) = 0.95 * $50 + 0.05 * (-$1150)

E(X) = $47.50 - $57.50

E(X) = -$10

The expected value of the proposal is -$10. This means that, on average, the company can expect to lose $10 per warranty sold.

Interpretation of the expected value:

The expected value of -$10 indicates that, on average, for every 2-year warranty sold, the company can expect to lose $10. This means that the proposal is not a profitable venture for the company. The replacement costs of the 5% of failed products are higher than the revenue generated by selling the warranties and cannot cover the potential losses. As a result, the company might want to reconsider the pricing of the warranty or look for other ways to reduce the potential costs associated with the product failures.

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Related Questions

Find the volume of a cylinder with the height 25cm and radius 5cm

Answers

Answer:

= 1963.5cm³

Step-by-step explanation:

radius=5

height=25

V=πr2h=π·52·25≈ 1963.49541cm³

Given f(x) = |x| and g(x) = 2x-3. Solve for (f ⚬ g)(x)

Answers

Step-by-step explanation:

(f o g)(x)

= f(g(x))

= f(2x - 3)

= |2x - 3|

Write the expression as the sine cosine or tangent of an angle calculator.

Answers

Answer:

hello your question is incomplete here is the complete question

write the expression as the sine, cosine,  or tangent of an angle.

[tex]sin 60 cos 15 + cos 60 sin 15[/tex]

answer : [tex]sin 60 cos 15 + cos 60 sin 15 = sin 75[/tex]

Step-by-step explanation:

To write the expression as the sine,cosine or tangent of an angle we will employ the trigonometry identity

[tex]sin 60 cos 15 + cos 60 sin 15[/tex]  can be represented in the form of ;

sin( u + v ) = sin u cos v + cos u sin v --------- (1)

comparing equation 1 with the given expression

u = 60 and v = 15

therefore writing the expression in the form of the sine of an angle would be the answer

= sin( 60 + 15 )  = sin 60 cos 15 + cos 60 sin 15

hence sin ( 75 ) = sin 60 cos 15 + cos 60 sin 15

$20,000 was invested in a 3-year simple interest money market account. After 3 years,
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What was the interest rate for the account?

Answers

Step-by-step explanation:

Amount = principal + S. I.

S. I. = p * t * r / 100

32000 = 20000 + 20000 * 3 * r / 100

12000 = 600 r

r ( Rate of interest) = 20 %

the intersection of a line and plane is a line

Answers

this statement is false.

Chris can be paid in one of two ways. Plan A is a salary of $400 per month, plus
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commission of 3% of sales. For what amount of sales is Chris better off selecting
plan A?

Answers

Answer:

$7300

Step-by-step explanation:

For Chris to select plan A, Plan A salary should be greater than that of plan B. Let the amount of sales be x

[tex]400 + \frac{7}{100} x > 692 + \frac{3}{100} x \\ \frac{7}{100} x - \frac{3}{100} x > 692 - 400 \\ \frac{4}{100} x > 292 \\ x > 7300[/tex]

Given g(x)=−2x2+1, find the indicated values: g(-4)

Answers

g(-4) means inputing -4 into x. So you will be replacing x with -4 in order to find a y for that input (-4). So...

g(-4)=-2(-4)^(2) + 1
=8^2 +1
= 64 +1
=65
(btw the question is a bit weird so im assuming that you forgot the exponent sign and it is -2x^2 + 1)

Choose the most appropriate name for the function:
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A. Output(input), or O(i)
B. Input(output), or O(i)
C. Input(output), or I (0)
D. Output(input), or i(0)

Answers

Output(input), or O(i)

Alvin's age is three times Elga's age. The sum of their ages is 116. What is Elga's age?
years old

Answers

Answer:

Let Elga's Age be x and Alvin's age be 3x

x + 3x = 116

4x = 116

x = 116/4

x = 29

Therefore , 3x = 3(29) = 87

Elga's Age - 29

Alvin's Age - 87

What number must be added to 36 to obtain −17?

Answers

That would be 36 + -53 = -17 is -53

A recipe says that 2 cups of dry rice will serve 6 people. How many cups of rice are needed to serve 45 people?
(Please Help)

Answers

Answer:

7.5 cups pf rice

Step-by-step explanation:

45 divided by 6

Please help this math problems

Answers

Answer:

1)85

2)-3

3)-5

4)98

5)2

6)-3

7)-5

8)-1

9)-4

10)2

11)535

Step-by-step explanation:

What value of n makes the equation true?

Answers

Answer:

n=10

Step-by-step explanation:

You need n to be 10 because: y^20= (y^10)^2

Answer:

n = 10

Step-by-step explanation:

(2x⁹yⁿ) * (4x²y¹⁰) = 8 x¹¹ y²⁰

use the rules of exponents to simplify the expression.

2¹ x⁹ yⁿ * 4¹ x² y¹⁰

use the commutative property of multiplication

2¹ * 4¹ x⁹ x² yⁿ y¹⁰

add exponents of the same base:

8 x⁹ ⁺ ²  y ⁿ ⁺ ¹⁰

back to original equation:

8 x⁹ ⁺ ²  y ⁿ ⁺ ¹⁰ =  8 x¹¹ y²⁰

therefore

the value of n = 10

28=8k+12-7k I HAVE 1 minute to answer this and show work QUICK PLEASE

Answers

Answer:

Step-by-step explanation:

16=k

The value of k from the given equation is 16.

What is an equation?

In mathematics, an equation is a formula that expresses the equality of two expressions, by connecting them with the equals sign =.

The given equation is 28=8k+12-7k.

The solution of an equation is the set of all values that, when substituted for unknowns, make an equation true.

Here, 28=k+12

k=28-12

k=16

Therefore, the value of k from the given equation is 16.

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A gallon of gas cost $2.16. Rob buys 13.5 gallons of gas. How much did he pay?

Answers

Answer:

$29.16

Step-by-step explanation:

Each gallon of gas is $2.16.

13.5 gallons of gas is 2.16 (13.5) = $29.16.

Rob spent $29.16 on gas. You get this by multiplying the amount a gallon of gas costs by the amount of gallons he bought. 2.16 x 13.5 = 29.16

11.
- 2x + y -z= 2
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3x + 6z= -24

Answers

What do you need exactly

. When the process of solving a linear inequality results in the variable being eliminated with a false statement remaining, what does this mean about the solution set of the inequality?

Answers

Answer:

No Solution

Step-by-step explanation:

When we solve linear inequalities using any one the methods such as

1) Elimination  or

2) Substitution

And we get  the variable eliminated with a false statement remaining, this means there is no solution.

In other words the solution does not exist or the solution is not possible in the given range or the values given are false.

But when the values are true we get a solution for the variable solved.

In the elimination method we eliminate the same terms by addition or subtraction after making them equal.

And the substitution method requires putting the values of one variable in place of another.

21
Find an equation of the line containing the given pair of points.
(4,5) and (12,8)

Answers

The answer is 8y=3x+28

How much is X? NEED HELP RIGHT NOW 20 POINTS!!!

Answers


The letter x often used to mean a value that is not yet known. It is called a "variable" or sometimes an "un". In x + 2 = 7, x is a variable, but we can work out its value if we try!

Multiply. ​ 1/4 x 2/5 ​ Express your answer in simplest form. 1/3 1/10 2/9 3/20

Answers

1/4 x 2/5 = 2/20=1/10

Answer: 1/10

Step-by-step explanation:

1/10 which means that 2/9 Was the wrong answer

Four students were discussing how to find the unit rate for a proportional relationship. Which method is valid?
"Look at the graph of the relationship. Find the y-value of the point that corresponds to x = 1. That value is the unit
rate."
"Look at the graph of the relationship. Count the number of units up and the number of units to the right one must
move to arrive at the next point on the graph. Write these two numbers as a fraction."
"Look at the graph of the relationship. Find the x-value of the point that corresponds to y = 2. That value is the unit
rate."
"Look at the graph of the relationship. Find two points which have y-values that are one unit apart. The unit rate is
the difference in the corresponding x-values."

Answers

Answer:

The correct answer I believe is A.

A.) “Look at the graph of the relationship. Find the y-value of the point that corresponds to x = 1. That value is the unit rate.”

Step-by-step explanation:

I took the test on edge :)

Answer:

A

Step-by-step explanation:Lol

What is the domain of the given function?

{(3, –2), (6, 1), (–1, 4), (5, 9), (–4, 0)}

Answers

domain: set of x-coordinates

3, 6,-1, 5, -4

expressions that are equivalent to -8.

Answers

Answer:

f(1)=5x-13=-8

Step-by-step explanation:

5-13=-8

or

f(1)=5x-13=-8

Find the inverse of the equation f(x)=ln(x/x-2)

Answers

Answer:

inverse of f(x) = (2e^x)/(e^(x)-1)

Step-by-step explanation:

If the object has leaves, then it is a tree.

Answers

Answer:

False

Step-by-step explanation:

Answer:

false

Step-by-step explanatio

Fruits and vegatables have leaves too, but yet there not a tree

Hilda rented a canoe the rental rate is $20 flat fee and 12.50 per hour. She was charged a total of 67.50. Which equation could be used to find h, the number of hours she rented the canoe.

Answers

Answer:12.50×20

Step-by-step explanation:

12.50. ×20=67.50

20 +12.50x =67.50

c=hours

if you need to find how many hours do 67.50-20 . Then do the answer to that divide by 12.50.

Hope this helpsss !

Lina rolled a die.

What is the probability that she got 3?

Answers

1/6 (if it’s a regular dice you’re talking about.

Answer:

1/6

Step-by-step explanation:

So asuming that she didn't roll a biased die the probability of getting a three is 1/6

This is because the total outcomes are 6 and there is only one three thus the probability that she got 3 is 1/6.

HOPE THIS HELPED


Consumers are paying record amounts of fees for overdrawing their bank accounts. In 2007, bankes this and credit unions collected $649 on in overdraft fees, which is $144 on more than in 2001. What is the
percent of increase?

Answers

Answer: 1.3 percent increase (to the nearest 10th

Step-by-step explanation: to figure out the percent of increase, you have to take the $144 away from 649, which is $505, then divide so:

$649 - $144 = $505

$649 / $505 = 1.28...or ~1.3

a car slows from 44m/s to 16m/s over 3s what is its average acceleration?

Answers

a=(16-44)/3= -9.333m/s²

I need help and it’s due today

Answers

Answer:

45

Step-by-step explanation:

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