Grear tire company has produced a new tire with an estimated mean lifetime mileage of 36,500 miles. management also believes that the standard deviation is 5000 miles and that tire mileage is normally distributed. to promote the new tire, grear has offered to refund some money if the tire fails to reach 30,000 miles before the tire needs to be replaced. specifically, for tires with a lifetime below 30,000 miles, grear will refund a customer $1 per 100 miles short of 30,000.

a. for each tire sold, what is the expected cost of the promotion?

b. what is the probablility that grear will refund more than $ 50 for a tire?

c. what milage should grear set the promotion claim if it wants the expected cost to be $2?

What is the relationship between marginal external cost, marginal social cost, and marginal private cost? a. marginal social cost equals marginal private cost plus marginal external cost. b. marginal private cost plus marginal social cost equals marginal external cost. c. marginal social cost plus marginal external cost equals marginal private cost. d. marginal external cost equals marginal private cost minus marginal social cost. marginal external cost a. is expressed in dollars, so it is not an opportunity cost b. is an opportunity cost borne by someone other than the producer c. is equal to two times the marginal private cost d. is a convenient economics concept that is not real

For 2018, rahal's auto parts estimates bad debt expense at 1% of credit sales. the company reported accounts receivable and an allowance for uncollectible accounts of $86,500 and $2,100, respectively, at december 31, 2017. during 2018, rahal's credit sales and collections were $404,000 and $408,000, respectively, and $2,340 in accounts receivable were written off. rahal's accounts receivable at december 31, 2018, are:

This exercise illustrates that poor quality can affect schedules and costs. a manufacturing process has 130 customer orders to fill. each order requires one component part that is purchased from a supplier. however, typically, 3% of the components are identified as defective, and the components can be assumed to be independent. (a) if the manufacturer stocks 130 components, what is the probability that the 130 orders can be filled without reordering components? (b) if the manufacturer stocks 132 components, what is the probability that the 130 orders can be filled without reordering components? (c) if the manufacturer stocks 135 components, what is the probability that the 130 orders can be filled without reordering components?