Mathematics
Mathematics, 26.10.2019 05:43, evan1v1123

Asmall market orders copies of a certain magazine for its magazine rack each week. let x = demand for the magazine, with the following pmf. x 1 2 3 4 5 6 p(x) 1/15 2/15 3/15 4/15 3/15 2/15 a) suppose the store owner actually pays $2.00 for each copy of the magazine and the price to customers is $4.00. if magazines left at the end of the week have no salvage value, is it better to order three or four copies of the magazine? [hint: for both three and four copies ordered, express net revenue as a function of demand x, and then compute the expected revenue.] b) what is the expected profit if three magazines are ordered? (round your answer to two decimal places.)

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