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    Expected Value and Standard Deviation

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    Myers Business Systems is evaluating the introduction of a new product. The possible levels of unit sales and the probabilities of their occurrence are given below:
    Possible Sales
    Market Reaction in Units Probabilities
    Low response . . . . . . . . . . . . . 20 .10
    Moderate response . . . . . . . . . 40 30
    High response . . . . . . . . . . . . . 55 .40
    Very high response . . . . . . . . . 70 .20
    a. What is the expected value of unit sales for the new product?
    b. What is the standard deviation of unit sales?

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    Solution Preview

    Expected Value and Standard Deviation
    Myers Business Systems is evaluating the introduction of a new product. The
    possible levels of unit sales and the probabilities of their occurrence are given
    below:
    Possible Sales
    Market Reaction in Units Probabilities
    Low response . . . . . . ...

    Solution Summary

    This solution is comprised of a detailed explanation to calculate what is the expected value of unit sales for the new product and what is the standard deviation of unit sales.

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