Problem 1. For the past four years, Armonco Manufacturing has been offering a th

Question

Problem 1. For the past four years, Armonco Manufacturing has been offering a three-year limited warranty on all appliances it manufactures. Although all appliances are given a unique serial number when manufactured, until this year Armonco had no capability of determining how often any appliance was brought to an authorized service facility. At the beginning of the year, the long-promised computer database linking all service facilities with a central system was finally operational. A preliminary report shows the following results for one of the appliances Armonco manufactures. Times Brought for Repair Probability 0 0.55 1 0.25 2 0.14 3 0.04 4 0.02 Find the expected number of repairs for this appliance (distribution mean).

Explanation / Answer

Given mean = 2 No of appliances expected to return next month x = 2 Probability by using Poisson's distribution formula = 0.6767

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