The demand for a product of a company varies greatly from month to month. The probability distribution for the company’s monthly demand, based on the past two years of data, is given: Demand: 250 375 425 575 Probability: 0.20 0.35 0.40 0.05. a) What is the expected value of the monthly demand? b) If each unit costs $40 and generates $60 in revenue, how much will the company gain or lose in a month if its production level is based on your answer to a) and the actual demand for the item is 250?
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.
S5.1. The demand for a product of a company varies greatly from month to month. The probability distribution for the company’s monthly demand, based on the past two years of data, is given:
Demand: 250 375 425 575
Probability: 0.20 0.35 0.40 0.05.
a) What is the
b) If each unit costs $40 and generates $60 in revenue, how much will the company gain or lose in a month if its production level is based on your answer to a) and the actual demand for the item is 250?
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