Your company sells and services dishwashers. The data show the number of warrant

Question

Your company sells and services dishwashers. The data show the number of warranty repair calls your company has made on all the dishwashers it has sold over the past year. Each dishwasher comes with a 1-year warranty. During the warranty period, your company will repair the dishwasher at no cost to the customer. Each repair call costs your company $300. Based on this data, answer the following questions. Show your work. 0 repairs 1 repair 2 3 4 5 6 7 total 3131 140 36 189 12 1 2 27 3538 1. You sell a dishwasher today. How much do you expect it to cost the company to service that dishwasher over the warranty period? Your company sells and services dishwashers. The data show the number of warranty repair calls your company has made on all the dishwashers it has sold over the past year. Each dishwasher comes with a 1-year warranty. During the warranty period, your company will repair the dishwasher at no cost to the customer. Each repair call costs your company $300. Based on this data, answer the following questions. Show your work. 0 repairs 1 repair 2 3 4 5 6 7 total 3131 140 36 189 12 1 2 27 3538 1. You sell a dishwasher today. How much do you expect it to cost the company to service that dishwasher over the warranty period?

Explanation / Answer

Expected repairs = [( 0 × 3131) + ( 1 × 140) + (2 × 36) + ( 3× 189) + ( 4× 12) + (5× 1) + (6 × 2) + ( 7× 27)]/3538

= 1033/3538

= 0.2920

Therefore, expected cost = 0.2920 ×300 = 87.60

The expected cost for the company is $87.60.

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