An insurance for an appliance costs $47 and will pay $582 if the insured item breaks plus the cost of the insurance. The insurance company estimates that the proportion 0.06 of the insured items will break.Let X be the random variable that assigns to each outcome (item breaks, item does not break) the profit for the company. A negative value is a loss. The distribution of X is given by the following table.

X 47 -582
p(x) ? 0.06
Complete the table and calculate the expected profit for the company. In other words, find the expected value of X.

Answers

Answer 1

Answer:

Answer: See explanation!

Step-by-step explanation:

To complete the table, we need to calculate the probability of the item not breaking. Since the proportion of items that break is 0.06, the proportion of items that do not break is 1 - 0.06 = 0.94.

Now we can fill in the table:

X | -582 | 47

p(x) | 0.06 | 0.94

To calculate the expected profit for the company, we multiply each outcome by its corresponding probability and sum the results:

Expected profit = (-582) * 0.06 + 47 * 0.94

Calculating this expression, we find that the expected profit for the company is approximately $3.92.

Therefore, the expected value of X, the random variable representing the profit for the company, is $3.92.

Step-by-step explanation:

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