A company sells its products to wholesalers in batches of 1,000 units only. The daily demand for its product and the respective probabilities are given below.
Demand (Units)
Probability
0
0.2
1000
0.2
2000
0.3
3000
0.2
4000
0.1
?
a.Determine the expected daily demand.b.Assume that the company sells its product at $3.75 per unit. What is the expected daily revenue?
What will be an ideal response?
| a. | 1800 |
| b. | $6,750 |
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