A concessions manager at the Tech versus A&M football game must decide whether to have the vendors sell sun visors or umbrellas. There is a 30% chance of rain, a 15% chance of overcast skies, and a 55% chance of sunshine, according to the weather forecast in College Junction, where the game is to be held. The manager estimates that the following profits will result from each decision, given each set of weather conditions: Weather Conditions Rain Overcast Sunshine Decision .03 .15 .55 Sun visors $- 500 $-200 $1,500 Umbrellas 2,000 -900 a. Compute the expected value for each decision, and select the best one. b. Develop the opportunity loss table, and compute the expected opportunity loss for each decision.
A concessions manager at the Tech versus A&M football game must decide whether to have the vendors sell sun visors or umbrellas. There is a 30% chance of rain, a 15% chance of overcast skies, and a 55% chance of sunshine, according to the weather forecast in College Junction, where the game is to be held. The manager estimates that the following profits will result from each decision, given each set of weather conditions: Weather Conditions Rain Overcast Sunshine Decision .03 .15 .55 Sun visors $- 500 $-200 $1,500 Umbrellas 2,000 -900 a. Compute the expected value for each decision, and select the best one. b. Develop the opportunity loss table, and compute the expected opportunity loss for each decision.
Chapter9: Sequences, Probability And Counting Theory
Section9.5: Counting Principles
Problem 3SE: Answer the following questions. 3. When given two separate events, how do we know whether to apply...
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Transcribed Image Text:A concessions manager at the Tech versus A&M football game must decide whether to have the
vendors sell sun visors or umbrellas. There is a 30% chance of rain, a 15% chance of overcast
skies, and a 55% chance of sunshine, according to the weather forecast in College Junction, where
the game is to be held. The manager estimates that the following profits will result from each
decision, given each set of weather conditions:
Weather Conditions
Rain
Sunshine
Overcast
.15
Decision
.03
.55
Sun visors
$-500
$-200
$1,500
Umbrellas
2,000
-900
a. Compute the expected value for each decision, and select the best one.
b. Develop the opportunity loss table, and compute the expected opportunity loss for each
decision.
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