-Question Help * Section 6.2 Exercise8 te a timeshare plan at a new resort They

Question

-Question Help * Section 6.2 Exercise8 te a timeshare plan at a new resort They estimate that 20% of potential customers wil choose the A marketing agency has developed three vacation packages o promo Day Plan, which does not include overnight accommodations, 10 wil choose the Weekend Plan, which includes two nights Complete parts a and b below night Pan, which des one night at me resort and 70% wil chose the need a) Find the expected value of the number of nights potential customers w E(X)-O night(s) (Simplify your answer. Type an integer or a decimal)

Explanation / Answer

Solution:

From the given information the marketing agencies vacation package details and their estimate of the potential customer who choose the plans are tabulated as follows:
Plan No. of nights P(X = x)
Day plan 0 0.2
Overnight plan 1 0.1
Weekend Plan 2 0.7

Expected value is given by the formula
E(X) = xP(x)
Now in order to find the expected value we have
E(X) = 0 * 0.20 + 1*0.10 + 2*0.70
= 0.10 + 1.4 = 1.5
The expected value of the number of nigjts a potential customer will need is E(X) = 1.5 nights

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