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The Alliance Corp. expects to sell the following number of units of copper cables at the prices indicated, under three different scenarios in the economy. The probability of each outcome is indicated.

Outcome Probability Units Price
A 0.20 315 $38
B 0.50 550 53
C 0.30 870 73

What is the expected value of the total sales projection?

Respuesta :

Answer:

$36,022

Explanation:

Given that,

Outcome A:

Probability = 0.20

Units = 315

Price = $38

Outcome B:

Probability = 0.50

Units = 550

Price = $53

Outcome C:

Probability = 0.30

Units = 870

Price = $73

Therefore,

Expected value of the total sales projection:

= Outcome A + Outcome B + Outcome C

= (0.20 × 315 × $38) + (0.50 × 550 × $53) + (0.30 × 870 × $73)

= $2,394 + $14,575 + $19,053

= $36,022

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