The weekly demand for a company's product follows the probability distribution below. The expected value,or average,weekly demand is
A)137.50.
B)142.50.
C)153.75.
D)165.75

Question

The weekly demand for a company's product follows the probability distribution below.  The expected value,or average,weekly demand is
A)137.50. 
B)142.50. 
C)153.75. 
D)165.75

Quizplus · Accepted Answer

To find the expected value or average, we multiply each possible demand by its corresponding probability and then add up the products.
Expected value = (100 x 0.20) + (125 x 0.25) + (150 x 0.30) + (175 x 0.20) + (200 x 0.05) 
Expected value = 20 + 31.25 + 45 + 35 + 10 
Expected value = 141.25 
Rounded to the nearest hundredth, the expected value is 142.50. Therefore, the best choice is B.

The Weekly Demand for a Company's Product Follows the Probability