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Math Help - Sales Incentive Problem

  1. #1
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    Exclamation Sales Incentive Problem

    Luis is a salesperson specializing in televisions at an electronics store. This table shows the probability of his selling various sizes of televisions.

    TV Sales Probability
    30" 0.1
    25" 0.4
    19" 0.3
    13" (smallest) 0.15

    1. What is the probability of his selling a larger television than the ones listed?

    2. Luis's manager offers him a selling incentive. He agrees to give Luis $25 for every 30" television. If Luis sells a larger television, the manager agrees to give him $50. What is the mathematical expectation for this payment plan?


    I don't understand how i'm suppose to go about solving this problem. I would really appreciate your help. REALLY REALLY
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  2. #2
    Grand Panjandrum
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    Quote Originally Posted by journeygirl280 View Post
    Luis is a salesperson specializing in televisions at an electronics store. This table shows the probability of his selling various sizes of televisions.

    TV Sales Probability
    30" 0.1
    25" 0.4
    19" 0.3
    13" (smallest) 0.15

    1. What is the probability of his selling a larger television than the ones listed?
    Baddly formulated question. Should say something like: When Luis makes a
    sale the probability of it being of variouse sizes is : ...

    The probability of selling one of the listed TVs is: 0.15+0.3+0.4+0.1 = 0.75,
    so the probability that it is larger (there are no smalle) is 0.25.


    2. Luis's manager offers him a selling incentive. He agrees to give Luis $25 for every 30" television. If Luis sells a larger television, the manager agrees to give him $50. What is the mathematical expectation for this payment plan?
    If he makes a sale the expectation is:

    25*P(30) + 50*P(>30) = 0.1*25 + 0.25*50 = $31.25

    where P(30) denote the probability that the sale is of a 30" TV and P(>30)
    is the probability that the sale is of a larger TV.

    RonL
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