6.28 OfficeQuip is a small office supply firm that is currently bidding on furni

Question

6.28 OfficeQuip is a small office supply firm that is currently bidding on furniture and office equipment contracts with four different potential customers who are of comparable size. For each contract, OfficeQuip would gain a profit of $50,000 if that contract were accepted, so the company could make as little as $0 or as much as $200,000. The four potential customers are making independent decisions, and in each case the probability that OfficeQuip will receive the contract is 0.40 Please round (a) through (e) to 4 decimals. a, when all the decisions have been made, the probability that OfficeQuip will receive none of the contracts is·13 b. When all the decisions have been made, the probability that OfficeQuip will receive exactly one of the contracts is 0.35 c. When all the decisions have been made, the probability that OfficeQuip will receive exactly two of the contracts is o.35 d. When all the decisions have been made, the probability that OfficeQuip will receive exactly three of the contracts is 0.15 e. When all the decisions have been made, the probability that OfficeQuip will receive all four contracts is f.Overall OfficeQuip's expected profit in this business procurement venture is S 80

Explanation / Answer

Solution :

n = 4

p =0.40

q = 0.60

Formula:

P(k out of n )= n!*pk * qn-k / k! *(n - k)!

P( x = 4 ) = 4!*0.44 * 0.64-4 / 4! *(4 - 4)!

= 0.0256

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