Explanation Given: A merchant buys boxes of fruit from a grower and sells them whereas boxes contain good fruits and bad fruits. A good box contains 80 % excellent fruit and while selling it a merchant can earn a profit on the retail market. A bad box contains 30 % excellent fruit and will produce a loss of $ 1000 . Then, the prior probability of receiving a good box of fruit is .9 . The merchant can sample one piece of fruit to test whether it is excellent and based on that he can reject without paying. The given options are as follows. (a) 0 (b) $ 16 (c) $ 34 (d) $ 72 (e) $ 80 Formula used: E ( x ) = ∑ x i p i Here, E is the expected value of the random variable x and p is the cross-ponding probability. Calculation: According to the question, The probability of receiving a good box is: .9 . Then, the probability of receiving a bad box is: 1 − .9 = .1 . After receiving a good box, the probability of containing excellent fruits is: .8 and will get $ 200 as a profit. Similarly, The probability of containing excellent fruits is: .3 and will produce $ 1000 as a loss. Meanwhile, if the merchant sample’s the fruit and is not found excellent, then he can reject the box and no money is to be paid. Now, consider the first case, when merchants have the right to sample the fruits is like when it is excellent then, he accepts the box and if the fruit is not excellent than he will not buy. There can be the probability that merchant chose the excellent fruits from the bad box. Then, the probability of getting excellent fruits from the good box is: .9 × .8 = .72 . And the probability of getting excellent fruits from the bad box is:

Mathematics with Applications In the Management, Natural and Social Sciences (11th Edition)

11th Edition

ISBN: 9780321931078

Author: Margaret L. Lial, Thomas W. Hungerford, John P. Holcomb, Bernadette Mullins

Publisher: PEARSON

See similar textbooks

Concept explainers

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 re…

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.

Videos

Question

Chapter 9, Problem 47RE

To determine

To calculate: To determine the expected value on the basis of the right to sample and probabilities if he does not sample the fruits.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Chapter 9, Problem 46RE

Chapter 9, Problem 48RE

Students have asked these similar questions

2) Suppose we select two values x and y independently from the uniform distribution on [0,1]. What is the probability that xy

No chatgpt pls will upvote Already got wrong chatgpt answer

Your employer automatically puts 5 percent of your salary into a 401(k) retirement account each year. The account earns 10% interest. Suppose you just got the job, your starting salary is $60000, and you expect to receive a 2.5% raise each year. For simplicity, assume that interest earned and your raises are given as nominal rates and compound continuously. Find the value of your retirement account after 20 years

Chapter 9 Solutions

Mathematics with Applications In the Management, Natural and Social Sciences (11th Edition)

Ch. 9.1 - Checkpoint 1 (a) Give the probability distribution...Ch. 9.1 - Checkpoint 2 Find the expected value of the number...Ch. 9.1 - Prob. 3CP Ch. 9.1 - Prob. 4CP Ch. 9.1 - Prob. 5CP Ch. 9.1 - Prob. 6CP Ch. 9.1 - Prob. 1E Ch. 9.1 - Prob. 2E Ch. 9.1 - Prob. 3E Ch. 9.1 - Prob. 4E

Ch. 9.1 - Prob. 5E Ch. 9.1 - Prob. 6E Ch. 9.1 - Prob. 7E Ch. 9.1 - Prob. 8E Ch. 9.1 - Prob. 9E Ch. 9.1 - Prob. 10E Ch. 9.1 - Prob. 11E Ch. 9.1 - Prob. 12E Ch. 9.1 - Prob. 13E Ch. 9.1 - Prob. 14E Ch. 9.1 - Prob. 15E Ch. 9.1 - Prob. 16E Ch. 9.1 - Prob. 17E Ch. 9.1 - Prob. 18E Ch. 9.1 - Prob. 19E Ch. 9.1 - Prob. 20E Ch. 9.1 - Prob. 21E Ch. 9.1 - Prob. 22E Ch. 9.1 - Prob. 23E Ch. 9.1 - Prob. 24E Ch. 9.1 - Prob. 25E Ch. 9.1 - Prob. 26E Ch. 9.1 - Prob. 27E Ch. 9.1 - Prob. 28E Ch. 9.1 - Prob. 29E Ch. 9.1 - Prob. 30E Ch. 9.1 - Prob. 31E Ch. 9.1 - Prob. 32E Ch. 9.1 - Prob. 33E Ch. 9.1 - Prob. 34E Ch. 9.1 - Prob. 35E Ch. 9.1 - Prob. 36E Ch. 9.1 - Prob. 37E Ch. 9.1 - Prob. 38E Ch. 9.1 - Prob. 39E Ch. 9.1 - Prob. 40E Ch. 9.1 - 41. Business Levi Strauss and Company uses...Ch. 9.1 - Prob. 42E Ch. 9.1 - Prob. 43E Ch. 9.1 - 44. Physical Science One of the few methods that...Ch. 9.1 - Prob. 45E Ch. 9.1 - Prob. 46E Ch. 9.2 - Prob. 1CP Ch. 9.2 - Prob. 2CP Ch. 9.2 - Prob. 3CP Ch. 9.2 - Prob. 4CP Ch. 9.2 - Prob. 5CP Ch. 9.2 - Prob. 6CP Ch. 9.2 - Prob. 7CP Ch. 9.2 - Prob. 8CP Ch. 9.2 - Prob. 9CP Ch. 9.2 - Checkpoint 10 Solve the problems in Example 14. Ch. 9.2 - Prob. 11CP Ch. 9.2 - Prob. 12CP Ch. 9.2 - Prob. 13CP Ch. 9.2 - Prob. 1E Ch. 9.2 - Prob. 2E Ch. 9.2 - Prob. 3E Ch. 9.2 - Prob. 4E Ch. 9.2 - Prob. 5E Ch. 9.2 - Evaluate the given factorials, permutations, and...Ch. 9.2 - Prob. 7E Ch. 9.2 - Prob. 8E Ch. 9.2 - Prob. 9E Ch. 9.2 - Prob. 10E Ch. 9.2 - Prob. 11E Ch. 9.2 - Prob. 12E Ch. 9.2 - Prob. 13E Ch. 9.2 - Use a calculator to find values for Exercises...Ch. 9.2 - Use a calculator to find values for Exercises...Ch. 9.2 - Prob. 16E Ch. 9.2 - Prob. 17E Ch. 9.2 - Use a calculator to find values for Exercises...Ch. 9.2 - Use a calculator to find values for Exercises...Ch. 9.2 - Prob. 20E Ch. 9.2 - Prob. 21E Ch. 9.2 - Prob. 22E Ch. 9.2 - Prob. 23E Ch. 9.2 - Prob. 24E Ch. 9.2 - Prob. 25E Ch. 9.2 - Prob. 26E Ch. 9.2 - Prob. 27E Ch. 9.2 - Prob. 28E Ch. 9.2 - Prob. 29E Ch. 9.2 - Prob. 30E Ch. 9.2 - Prob. 31E Ch. 9.2 - Prob. 32E Ch. 9.2 - Prob. 33E Ch. 9.2 - Prob. 34E Ch. 9.2 - Prob. 35E Ch. 9.2 - Prob. 36E Ch. 9.2 - 37. Define permutation in your own words. Ch. 9.2 - Prob. 38E Ch. 9.2 - Prob. 39E Ch. 9.2 - Prob. 40E Ch. 9.2 - Prob. 41E Ch. 9.2 - Prob. 42E Ch. 9.2 - Prob. 43E Ch. 9.2 - Prob. 44E Ch. 9.2 - Prob. 45E Ch. 9.2 - Prob. 46E Ch. 9.2 - Prob. 47E Ch. 9.2 - Prob. 48E Ch. 9.2 - Prob. 49E Ch. 9.2 - Prob. 50E Ch. 9.2 - Prob. 51E Ch. 9.2 - Prob. 52E Ch. 9.2 - Prob. 53E Ch. 9.2 - Prob. 54E Ch. 9.2 - Prob. 55E Ch. 9.2 - Prob. 56E Ch. 9.2 - Prob. 57E Ch. 9.2 - Prob. 58E Ch. 9.2 - Prob. 59E Ch. 9.2 - Prob. 60E Ch. 9.2 - Prob. 61E Ch. 9.2 - Prob. 62E Ch. 9.2 - Prob. 63E Ch. 9.2 - Prob. 64E Ch. 9.2 - Prob. 65E Ch. 9.2 - Prob. 66E Ch. 9.2 - Prob. 67E Ch. 9.2 - Prob. 68E Ch. 9.2 - Prob. 69E Ch. 9.2 - Prob. 70E Ch. 9.2 - Prob. 71E Ch. 9.2 - Prob. 72E Ch. 9.2 - Prob. 73E Ch. 9.2 - Prob. 74E Ch. 9.3 - Checkpoint 1 The ski club has 8 women and 7 men....Ch. 9.3 - Checkpoint 2 A batch of 15 granite slabs is mined,...Ch. 9.3 - Checkpoint 3 Find the probability of being dealt a...Ch. 9.3 - Checkpoint 4 Martha, Leonard, Calvin, and Sheila...Ch. 9.3 - Checkpoint 5 Evaluate (a) n = 3; (b) n = 6. Ch. 9.3 - Prob. 6CP Ch. 9.3 - Prob. 1E Ch. 9.3 - Prob. 2E Ch. 9.3 - Prob. 3E Ch. 9.3 - Prob. 4E Ch. 9.3 - Prob. 5E Ch. 9.3 - Prob. 6E Ch. 9.3 - Prob. 7E Ch. 9.3 - Prob. 8E Ch. 9.3 - Prob. 9E Ch. 9.3 - Prob. 10E Ch. 9.3 - Prob. 11E Ch. 9.3 - Prob. 12E Ch. 9.3 - Prob. 13E Ch. 9.3 - Prob. 14E Ch. 9.3 - Prob. 15E Ch. 9.3 - Prob. 16E Ch. 9.3 - Find the probability that the 2-card hand in...Ch. 9.3 - Prob. 18E Ch. 9.3 - Prob. 19E Ch. 9.3 - Prob. 20E Ch. 9.3 - Prob. 21E Ch. 9.3 - Prob. 22E Ch. 9.3 - Natural Science A shipment contains 8 igneous, 7...Ch. 9.3 - Prob. 24E Ch. 9.3 - Prob. 25E Ch. 9.3 - Prob. 26E Ch. 9.3 - Prob. 27E Ch. 9.3 - Prob. 28E Ch. 9.3 - Prob. 29E Ch. 9.3 - Prob. 30E Ch. 9.3 - Prob. 31E Ch. 9.3 - Prob. 32E Ch. 9.3 - For Exercises 32–34, refer to Example 6 in this...Ch. 9.3 - For Exercises 32–34, refer to Example 6 in this...Ch. 9.3 - Prob. 35E Ch. 9.3 - Prob. 36E Ch. 9.3 - Prob. 37E Ch. 9.3 - One version of the New York State lottery game...Ch. 9.3 - Prob. 39E Ch. 9.3 - Prob. 40E Ch. 9.4 - Prob. 1CP Ch. 9.4 - Prob. 2CP Ch. 9.4 - Prob. 3CP Ch. 9.4 - Prob. 4CP Ch. 9.4 - Prob. 5CP Ch. 9.4 - Prob. 1E Ch. 9.4 - Prob. 2E Ch. 9.4 - Prob. 3E Ch. 9.4 - Prob. 4E Ch. 9.4 - Prob. 5E Ch. 9.4 - Prob. 6E Ch. 9.4 - Prob. 7E Ch. 9.4 - Prob. 8E Ch. 9.4 - Prob. 9E Ch. 9.4 - Prob. 10E Ch. 9.4 - Prob. 11E Ch. 9.4 - Prob. 12E Ch. 9.4 - Prob. 13E Ch. 9.4 - Prob. 14E Ch. 9.4 - Prob. 15E Ch. 9.4 - Prob. 16E Ch. 9.4 - Prob. 17E Ch. 9.4 - Prob. 18E Ch. 9.4 - Prob. 19E Ch. 9.4 - Prob. 20E Ch. 9.4 - Prob. 21E Ch. 9.4 - Prob. 22E Ch. 9.4 - Prob. 23E Ch. 9.4 - Prob. 24E Ch. 9.4 - Prob. 25E Ch. 9.4 - Prob. 26E Ch. 9.4 - Prob. 27E Ch. 9.4 - Prob. 28E Ch. 9.4 - Prob. 29E Ch. 9.4 - Prob. 30E Ch. 9.4 - Prob. 31E Ch. 9.4 - Prob. 32E Ch. 9.4 - Prob. 33E Ch. 9.4 - Prob. 34E Ch. 9.4 - Prob. 35E Ch. 9.4 - Prob. 36E Ch. 9.4 - Prob. 37E Ch. 9.4 - Prob. 38E Ch. 9.4 - Prob. 39E Ch. 9.4 - Prob. 40E Ch. 9.4 - Prob. 41E Ch. 9.4 - Prob. 42E Ch. 9.4 - Prob. 43E Ch. 9.4 - Prob. 44E Ch. 9.5 - Prob. 1CP Ch. 9.5 - Prob. 2CP Ch. 9.5 - Prob. 3CP Ch. 9.5 - Prob. 4CP Ch. 9.5 - Prob. 5CP Ch. 9.5 - Prob. 6CP Ch. 9.5 - Prob. 1E Ch. 9.5 - Prob. 2E Ch. 9.5 - Prob. 3E Ch. 9.5 - Prob. 4E Ch. 9.5 - Prob. 5E Ch. 9.5 - Prob. 6E Ch. 9.5 - Prob. 7E Ch. 9.5 - Prob. 8E Ch. 9.5 - Prob. 9E Ch. 9.5 - Prob. 10E Ch. 9.5 - Prob. 11E Ch. 9.5 - Prob. 12E Ch. 9.5 - Prob. 13E Ch. 9.5 - Prob. 14E Ch. 9.5 - Prob. 15E Ch. 9.5 - Prob. 16E Ch. 9.5 - Prob. 17E Ch. 9.5 - Prob. 18E Ch. 9.5 - Prob. 19E Ch. 9.5 - Prob. 20E Ch. 9.5 - Prob. 21E Ch. 9.5 - Prob. 22E Ch. 9.5 - Prob. 23E Ch. 9.5 - Prob. 24E Ch. 9.5 - Prob. 25E Ch. 9.5 - Prob. 26E Ch. 9.5 - Prob. 27E Ch. 9.5 - Prob. 28E Ch. 9.5 - Prob. 29E Ch. 9.5 - Prob. 30E Ch. 9.5 - Prob. 31E Ch. 9.5 - Prob. 32E Ch. 9.5 - Prob. 33E Ch. 9.5 - Prob. 34E Ch. 9.5 - Prob. 35E Ch. 9.5 - Prob. 36E Ch. 9.5 - Prob. 37E Ch. 9.5 - Prob. 38E Ch. 9.5 - Prob. 39E Ch. 9.5 - 40. Business An insurance company classifies its...Ch. 9.5 - Prob. 41E Ch. 9.5 - Prob. 42E Ch. 9.5 - Prob. 43E Ch. 9.5 - Prob. 44E Ch. 9.5 - Prob. 45E Ch. 9.5 - Prob. 46E Ch. 9.5 - Prob. 47E Ch. 9.6 - Prob. 1CP Ch. 9.6 - Prob. 2CP Ch. 9.6 - Prob. 3CP Ch. 9.6 - Prob. 1E Ch. 9.6 - Prob. 2E Ch. 9.6 - Prob. 3E Ch. 9.6 - Prob. 4E Ch. 9.6 - Prob. 5E Ch. 9.6 - Prob. 6E Ch. 9.6 - Prob. 7E Ch. 9.6 - Prob. 8E Ch. 9.6 - Prob. 9E Ch. 9.6 - Prob. 10E Ch. 9 - Prob. 1CE Ch. 9 - Prob. 2CE Ch. 9 - Prob. 3CE Ch. 9 - Prob. 4CE Ch. 9 - Prob. 5CE Ch. 9 - Prob. 1EP Ch. 9 - 2. Investigate whether your own state or a state...Ch. 9 - Prob. 1RE Ch. 9 - In Exercises 1–4, (a) sketch the histogram of the...Ch. 9 - In Exercises 1–4, (a) sketch the histogram of the...Ch. 9 - In Exercises 1–4, (a) sketch the histogram of the...Ch. 9 - Prob. 5RE Ch. 9 - Prob. 6RE Ch. 9 - Prob. 7RE Ch. 9 - Prob. 8RE Ch. 9 - Prob. 9RE Ch. 9 - Prob. 10RE Ch. 9 - Prob. 11RE Ch. 9 - Prob. 12RE Ch. 9 - Prob. 13RE Ch. 9 - Solve the given problems. 14. How many variations...Ch. 9 - Prob. 15RE Ch. 9 - Prob. 16RE Ch. 9 - Prob. 17RE Ch. 9 - Prob. 18RE Ch. 9 - Prob. 19RE Ch. 9 - Prob. 20RE Ch. 9 - Prob. 21RE Ch. 9 - Prob. 22RE Ch. 9 - Prob. 23RE Ch. 9 - Prob. 24RE Ch. 9 - Prob. 25RE Ch. 9 - Prob. 26RE Ch. 9 - Prob. 27RE Ch. 9 - Prob. 28RE Ch. 9 - Prob. 29RE Ch. 9 - Prob. 30RE Ch. 9 - Prob. 31RE Ch. 9 - Prob. 32RE Ch. 9 - Prob. 33RE Ch. 9 - Prob. 34RE Ch. 9 - Prob. 35RE Ch. 9 - Prob. 36RE Ch. 9 - Prob. 37RE Ch. 9 - Prob. 38RE Ch. 9 - Prob. 39RE Ch. 9 - Prob. 40RE Ch. 9 - Prob. 41RE Ch. 9 - Prob. 42RE Ch. 9 - Prob. 43RE Ch. 9 - Prob. 44RE Ch. 9 - Prob. 45RE Ch. 9 - Exercises 46 and 47 are taken from actuarial...Ch. 9 - Prob. 47RE Ch. 9 - Prob. 48RE

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, subject and related others by exploring similar questions and additional content below.