Question

Expected Value and Varia Problem 5 Previous Problem Problem List Next Problem (1 point) A concert producer has scheduled an outdoor concert. The producer estimates the attendance will depend on the weather according to the following table. Weather Attendance Probability wet, cold 6000 0.1 wet, warm 20000 0.2 dry,cold250000.1 dry, warm 60000 0.6 (a) What is the expected attendance? 36000 (b) If tickets cost $10 each, the band will cost $250, 000, plus $40, 000 for administration. What is the expected profit? Note: You can earn partial credit on this problem. Preview My Answers Submit Answers You have attempted this problem 1 time. Your overall recorded score is 0%. You have unlimited attempts remaining

Answer 1

Probability (p)              Attendence (x)                      xp

0.1                              6000                                 600

0.2                              20000                             4000

0.1                              25000                             2500

0.6                             60000                             36000

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Total                                                               43,100

Expected attendence = 43,100

(b)
Income by tickets = 43,100 X 10 = 431,000

Expenses:
Band = 250,000

Administration = 40,000

Total expenses = 290,000

So,

Expected profit = 431,000 - 290,000 = 141,000