Explanation 1) Definition: Assume that an experiment has outcomes numbered 1 to n with probabilities P 1 , P 2 , P 3 , ... P n . Assume that each outcome has a numerical value associated with it and these are labeled V 1 , V 2 , V 3 , ... V n . The expected value of the experiment is ( P 1 ⋅ V 1 ) + ( P 2 ⋅ V 2 ) + ( P 3 ⋅ V 3 ) + ... + ( P n ⋅ V n ) . 2) Calculation: Given, Demand for Bagels Sold 150 140 130 120 Number of Days with These Sales 3 6 5 6 Above table represents the past 20 days regarding the demand for bagels, Then, Profit of each bagels, = 90 cents − 65 cents = 25 cents = $ 0.25 If the demand is for 130 bagels, or 140 bagels or 150 bagels, Nell will sell all of her bagels at a profit of = 90 cents − 65 cents = 25 cents = $ 0.25 per bagel and a total profit of ( 130 ) ( $ 0.25 ) = $ 32.5 . If the demand is for 120 bagels, she will make = 120 ( 0.25 ) − 10 ( 0.65 ) = 30 − 6.5 = 23 .5 To determine b) To find: Nell’s expected daily profit if she orders 140 bagels per day.

Mathematics All Around, Books a la carte edition (6th Edition)

6th Edition

ISBN: 9780134462448

Author: Pirnot, Tom

Publisher: PEARSON

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Chapter 13.4, Problem 39E

To determine

a)

To find:

Nell’s expected daily profit if she orders 130 Bagels per day.

To determine

b)

To find:

Nell’s expected daily profit if she orders 140 bagels per day.

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Chapter 13.4, Problem 38E

Chapter 13.4, Problem 40E

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Mathematics All Around, Books a la carte edition (6th Edition)

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a) To find: Nell’s expected daily profit if she orders 130 Bagels per day.

Solution Summary: The author calculates Nell's expected daily profit if she orders 130 bagels per day. Each outcome has a numerical value associated with it.