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Using the given discrete distribution, it is found that the expected value is of $863.93.
The expected value of a discrete distribution is given by the sum of each outcome multiplied by it's respective probability.
In this problem, the distribution of costs is given by:
Hence, the expected value is given by:
E(X) = 0.87 x 986 + 0.13 x 47 = $863.93.
More can be learned about discrete distributions at https://brainly.com/question/24855677
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