A Small Software Company Bids On Two Contracts

Statistics Help!!!? 3

Software is a small software company with two agreements. This is an advantage

Profit of $ 50,000 on the largest contract and $ 20,000 on the smallest contract. NS

The company estimates that there is a 30% chance of winning the most important contract and a 60% chance

You get the smallest deal. After giving an independent contract,

What is the expected profit?

I know the answer, I need help finding the answer. How do you basically solve the problem?

Are you looking for the expected result or?

= 50,000 (0.3) + 20,000 (0.6) = 27,000

The standard deviation is:

sd = square root ((50,000 27,000) 2 * 0.3 + (20,000 27,000) 2 *, 6)

SD = $ 13,714.96

L = largest contract, S = smallest contract

E (L) x30% + E (S) x60% = 15,000 + 12,000 = 27,000.

Freedom is an important removal.

Otherwise, you will have to adjust for comfort.

What's important: What is a company? Because they can't really do that.