Answered

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If Brady & Mathew knows that it will sell many of these cameras, should it expect to make or lose money from sell them? How much?

If Brady Amp Mathew Knows That It Will Sell Many Of These Cameras Should It Expect To Make Or Lose Money From Sell Them How Much class=

Sagot :

Given:

• Profit per camera = $186

,

• Cost of replacing the camera = $3100

,

• Probability it will be replaced once = 4% = 0.04

,

• Probability it will be replaced twice = 1% = 0.01

,

• Probability it will not be replaced = 95% = 0.95

Now, let's determine if the company should expect to make money or lose money from selling the camera.

Let's find the expected cost of repair.

We have:

E = (0.04 x 3100) + (0.01 x 2 x 3100) + (0.95 x 0)

E = 124 + 62 + 0

E = 186

Therefore, the expected cost of repair is $186.

We can see the profit per camera and the expected cost of repair are the same.

Profit per camera = Expected cost of repair

Since they are equal, the company should expect to neither make nor lose money from selling these cameras.

ANSWER:

Brady & Matthew should expect to neither make nor lose money from selling these cameras.

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