Your Abercrom B men's fashion outlet has a 40% chance of launching an expensive new line of used auto-mechanic dungarees (complete with grease stains) and a 60% chance of staying instead with its traditional torn military-style dungarees. Your rival across from you in the mall, Abercrom A, appears to be deciding between a line of torn gym shirts and a more daring line of "empty shirts" (that is, empty shirt boxes). Your corporate spies reveal that there is a 40% chance that Abercrom A will opt for the empty shirt option. The payoff matrix gives the number of customers your outlet can expect to gain from Abercrom A in each situation.

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                                      Abercrom A

                                     Torn    Empty?

                                    Shirts   Shirts?

Abercrom B  

?

What is the expected resulting effect on your customer base? Round the answer to the nearest whole number.

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A. You can expect to lose 3 customers.

B. You can expect to lose 4 customers.

C. You can expect to lose 5 customers.

D. You can expect to gain 3 customers.

E. You can expect to gain 4 customers.


Answer: A

Mathematics

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