Asked by tracy
A contractor is considering a sale that promises a profit of $20,000 with a probability of .7 or a loss ( due to bad weather, strikes, and such) of $3000 with a probability of .3. What is the expected profit?
a. 13,100
b. 17,000
c. 14,000
d. 16,100
a. 13,100
b. 17,000
c. 14,000
d. 16,100
Answers
Answered by
bobpursley
expected value of profit= .7*20,000 -.3*3000
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