Originally Posted by
Kiwigirl Silica Tech sell Hercules P150 desktop computer for $2400 (includes GST). The owner has kept a record of the number of computers, n, sold per week and the results are shown in this probability distribution (This is a table, but I don't know how to create a table on a thread, I think you will get the idea):
N............1......2......3.....4
P(N = n).. 0.1...0.2...0.3...0.4
The expected sales each week:
1 x 0.1 + 2 x 0.2 + 3 x 0.3 + 4 x 0.4 = 3.
The calculated variance of the sales each week = 1.
The fixed costs of the business (salaries, rent, power and so on) are $900 per week and the profit per computer is $375.
So, the expected profit each week:
375 (1 x 0.1 + 2 x 0.2 + 3 x 0.3 + 4 x 0.4) - 900 = 225.
a) Find the variance in profit each week.