Suppose that for a particular piece of machinery, the frequency distribution of monthly breakdowns is as follows:

The cost of a breakdown is $2,000, and the cost of a preventive maintenance program is $2,000 per month. If the preventive maintenance program is adopted, the probability of a machine breakdown is negligible. How much better off per month would the firm be if it adopted preventive maintenance?
A)$100 worse off
B)$200 worse off
C)$100 better off
D)$200 better off
E)$2,000 better off

Question

Suppose that for a particular piece of machinery, the frequency distribution of monthly breakdowns is as follows:

The cost of a breakdown is $2,000, and the cost of a preventive maintenance program is $2,000 per month. If the preventive maintenance program is adopted, the probability of a machine breakdown is negligible. How much better off per month would the firm be if it adopted preventive maintenance?
A)$100 worse off 
B)$200 worse off 
C)$100 better off 
D)$200 better off 
E)$2,000 better off

Quizplus · Accepted Answer

The Answer of Suppose that for a particular piece of machinery, the frequency distribution of monthly breakdowns is as follows:

The cost of a breakdown is $2,000, and the cost of a preventive maintenance program is $2,000 per month. If the preventive maintenance program is adopted, the probability of a machine breakdown is negligible. How much better off per month would the firm be if it adopted preventive maintenance?
A)$100 worse off 
B)$200 worse off 
C)$100 better off 
D)$200 better off 
E)$2,000 better off

Suppose That for a Particular Piece of Machinery, the Frequency