Each good piece sold will produce $100,000 in revenue. However, if they are produced less than 8 good pieces, none will be purchased; if more than 10 good parts are produced, the surplus will not be purchased. Suppose the parts are produced independently with the probability of each piece being acceptable (good) equals 0.85. Use the binomial distribution to generate the odds (to make it easier, use up to 4 decimal places). Determine the expected profits in the batch production of the following quantities: 10, 11 and 12. For each of them, determine the probability of losing money in the transaction. Of the three options, which is the least preferred? Per what?

Each good piece sold will produce $100,000 in revenue. However, if they are produced less than 8 good pieces, none will be purchased; if more than 10 good parts are produced, the surplus will not be purchased. Suppose the parts are produced independently with the probability of each piece being acceptable (good) equals 0.85. Use the binomial distribution to generate the odds (to make it easier, use up to 4 decimal places). Determine the expected profits in the batch production of the following quantities: 10, 11 and 12. For each of them, determine the probability of losing money in the transaction. Of the three options, which is the least preferred? Per what?

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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