Question 60215: The Newman Constuction Comapany bids on a job to constuct a building>. If the bid is won, there is a 0.7 proability of making a $175,000 profit and there is a probability of 0.3 that the contractor will break even. what is the expected value? Use standard (u.s.) monetary format, with no blank between the $ sign and the value.
Answer by stanbon(75887)   (Show Source):
You can put this solution on YOUR website! The Newman Constuction Comapany bids on a job to constuct a building>.
If the bid is won, there is a 0.7 proability of making a $175,000 profit
and there is a probability of 0.3 that the contractor will break even.
what is the expected value?
Use standard (u.s.) monetary format, with no blank between the $ sign and the value.
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Note: "break even" means no loss and no gain.
but no "amount" of loss is stated. Hmmmm????
Expected Value = 0.7(175,000)+(0.3)(0)=$122,500
Cheers,
Stan H.
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