Probabilities and Market Response
Not what you're looking for?
1) Brax Technology Corporation is evaluating the introduction of a new product. The possible levels of unit sales and the probabilities of their occurrence are given.
Possible
market reaction Sales in units Probabilities
Low response 30 .10
Moderate response 40 .10
High response 55 .20
Very high response 65 .60
________________________________________
(a) What is the expected value of unit sales for the new product? (Round your answer to 2 decimal places.)
(b) What is the standard deviation of unit sales? (Round your final answer to 2 decimal places.)
2) Salome Builders Limited is evaluating a new promotional campaign that could increase home sales. Possible outcomes and probabilities of the outcomes are shown below.
Possible outcomes Additional sales in units Probabilities
Ineffective campaign 20 .40
Normal response 110 .40
Extremely effective 140 .20
________________________________________
(a) Compute the coefficient of variation. (Round your answer to 3 decimal places.)
Purchase this Solution
Solution Summary
The following posting discusses probabilities and market responses. Step by step calculations are given for each.
Solution Preview
1)
(a) Expected Value = 57
X P X*P
30 0.1 3.00
40 0.1 4.00
55 0.2 11.00
65 0.6 39.00
Expected Value=?[X*P] = 57.00
(b) Standard Deviation = 11.87
Recall:
Standard Deviation=?((X-E(X))^2*P)
X E(X) (X-E(X)) (X-E(X))2 P P*[(X-E(X))]^(2)
30 57.00 ...
Purchase this Solution
Free BrainMass Quizzes
IPOs
This Quiz is compiled of questions that pertain to IPOs (Initial Public Offerings)
Lean your Process
This quiz will help you understand the basic concepts of Lean.
Organizational Leadership Quiz
This quiz prepares a person to do well when it comes to studying organizational leadership in their studies.
Understanding Management
This quiz will help you understand the dimensions of employee diversity as well as how to manage a culturally diverse workforce.
Business Processes
This quiz is intended to help business students better understand business processes, including those related to manufacturing and marketing. The questions focus on terms used to describe business processes and marketing activities.