Answer:
The question is missing the below options:
A $3000 ?B$10,000 ?C$30,000 ?D$100,000
The correct option is A,as expected loss is $3000 as computed below
Explanation:
The expected loss can be computed thus:
probability of theft*property loss of theft+probability of no theft*property loss of no theft
Probability of theft is 0.3(30%)
probability of no theft 0.7(1-0.3)
property loss of theft is $10000
property loss when no theft occur is $0
Expected loss=0.3*$10000+0.7*$0
expected loss=$3000+$0
expected loss=$3000
One needs to know that the entire probability of theft and no theft occurring is 1,so when one is given as 0.3,automatically the remainder belongs to other.
