How do you find hx to calculate the expected value of a func
How do you find h(x) to calculate the expected value of a function
A computer store has purchased three computers of a certain type at $500 apiece. It will sell them for S1000 apiece. The manufacturer has agreed to repurchase any computers still unsold after a specified period at $200 apiece. Let X any computers stll unsold after a specified period at $200 apiece. Let 1X denote the number of computers sold, and suppose that p(0) ,l, p(1-2, p(2)= .3, and p(3)=4. With h(X) denoting the profit associated withSolution
Money earned by selling one computer = $1000
Money earned by selling X computers = $1000X
Money earned by giving back one computer to the manufacturer = $200
Number of computers unsold = 3-X
Money earned by giving back 3-X computers to the manufacturer = $200(3-X)
Money spent on purchasing computers = $500*3 = $1500
Therefore, net revenue = 1000X+200(3-X)
net cost = 1500
h(X) = Profit = Revenue- cost = 1000X+200(3-X) - 1500
