Calculate the mean of X.

A First Course in Probability (10th Edition)
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ISBN:9780134753119
Author:Sheldon Ross
Publisher:Sheldon Ross
Chapter1: Combinatorial Analysis
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An electronics retailer offers an optional protection plan for a mobile phone it sells. Customers can choose to buy the protection plan for $100 and in case of an accident, the customer pays a $50 deductible and the retailer will cover the rest of the cost of that repair. The typical cost to the retailer is $200 per repair, and the plan covers a maximum of 3 repairs.

Let X be the number of repairs a randomly chosen customer uses under the protection plan, and let F be the retailer's profit from one of these protection plans. Based on data from all of its customers, here are the probability distributions of X and F:

Calculate the mean of X.

 

X = # of repairs
1
2
3
F = retailer profit $100 -$50
-$200 -$350
Probability
0.90
0.07
0.02
0.01
Transcribed Image Text:X = # of repairs 1 2 3 F = retailer profit $100 -$50 -$200 -$350 Probability 0.90 0.07 0.02 0.01
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