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 $ 1300. A newly hired associate at the company proposes to charge $ 55 for a 2 year warranty. a. 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. E=_________________- b. Interpret the expected value in complete sentences. ____________- c. Write your review of the proposal and address it to VP of marketing and promotions. Include the following in your essay: Would the proposal benefit the company? Why or why not? Include the new proposed cost, new expected value, interpretation of the new expected value, and explanation of how the new cost was chosen.___________________________________________
Contingency Table
A contingency table can be defined as the visual representation of the relationship between two or more categorical variables that can be evaluated and registered. It is a categorical version of the scatterplot, which is used to investigate the linear relationship between two variables. A contingency table is indeed a type of frequency distribution table that displays two variables at the same time.
Binomial Distribution
Binomial is an algebraic expression of the sum or the difference of two terms. Before knowing about binomial distribution, we must know about the binomial theorem.
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 $ 1300.
A newly hired associate at the company proposes to charge $ 55 for a 2 year warranty.
a. 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. E=_________________-
b. Interpret the expected value in complete sentences. ____________-
c. Write your review of the proposal and address it to VP of marketing and promotions. Include the following in your essay: Would the proposal benefit the company? Why or why not? Include the new proposed cost, new expected value, interpretation of the new expected value, and explanation of how the new cost was chosen.___________________________________________
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