A small market orders copies of a certain magazine for its magazine rack each week. Let X = demand for the magazine, with the following pmf. 1 2 3 4 5 4 3 1 15 1 4 15 15 15 15 X p(x) 6 2 15 Suppose the store owner actually pays $2.00 for each copy of the magazine and the price to customers is $4.00. If magazines left at the end of the week have no salvage value, is it better to order three or four copies of the magazine? [Hint: For both three and four copies ordered, express net revenue as a function of demand X, and then compute the expected revenue.] What is the expected profit if three magazines are ordered? (Round your answer to two decimal places.) $2 X What is the expected profit if four magazines are ordered? (Round your answer to two decimal places.) $ 5.6 How many magazines should the store owner order? O 3 magazines O 4 magazines

A small market orders copies of a certain magazine for its magazine rack each week. Let X = demand for the magazine, with the following pmf. 1 2 3 4 5 4 3 1 15 1 4 15 15 15 15 X p(x) 6 2 15 Suppose the store owner actually pays $2.00 for each copy of the magazine and the price to customers is $4.00. If magazines left at the end of the week have no salvage value, is it better to order three or four copies of the magazine? [Hint: For both three and four copies ordered, express net revenue as a function of demand X, and then compute the expected revenue.] What is the expected profit if three magazines are ordered? (Round your answer to two decimal places.) $2 X What is the expected profit if four magazines are ordered? (Round your answer to two decimal places.) $ 5.6 How many magazines should the store owner order? O 3 magazines O 4 magazines

A First Course in Probability (10th Edition)

10th Edition

ISBN:9780134753119

Author:Sheldon Ross

Publisher:Sheldon Ross

Chapter1: Combinatorial Analysis

Section: Chapter Questions

Problem 1.1P: a. How many different 7-place license plates are possible if the first 2 places are for letters and...

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