tees r us, which manufactures and sells t-shirts for sporting events, is providi

Question

tees r us, which manufactures and sells t-shirts for sporting events, is providing shirts for an upcoming tournament. each shirt will cost $10 to prpduce and will be sold for $16. any unsold shirts left over at the end of the tournament xan be sold for $5 a piece in the near future. tees R Us assumes the demand for the shirts will be 1000,2000, 3000, or 4000. the company also estimates that the probabilities of each of these sales level occurring will be 15%,25%,30%, and 30%, respectively. determine the expected monetary value of the project if Tees R Us chooses to print 3,000 shirts for the tournament.


Help please show step by step. tees r us, which manufactures and sells t-shirts for sporting events, is providing shirts for an upcoming tournament. each shirt will cost $10 to prpduce and will be sold for $16. any unsold shirts left over at the end of the tournament xan be sold for $5 a piece in the near future. tees R Us assumes the demand for the shirts will be 1000,2000, 3000, or 4000. the company also estimates that the probabilities of each of these sales level occurring will be 15%,25%,30%, and 30%, respectively. determine the expected monetary value of the project if Tees R Us chooses to print 3,000 shirts for the tournament.


Help please show step by step.


Help please show step by step.

Explanation / Answer

Hence expected monetary value or monetary gain = +11950

Demand 1000 2000 3000 4000 Prob 0.15 0.25 0.3 0.3 Sold unsold Total Shirt cost 10 10 Shirts prd 3000 3000 3000 3000 Sales 16 5 Sold 1000 2000 3000 4000 profit 6 -5 Profit 6000 12000 18000 18000 unsold 2000 1000 0 -1000 Loss for unsold -10000 -5000 0 0 Net gain -4000 7000 18000 18000 Prob 0.15 0.25 0.3 0.3 Expected gain -600 1750 5400 5400 11950

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