A company operating a chain of drug stores plans to open a new store in one of the locations. The management of the company figures that at the first location the store will show an annual profit of $20,000 if it is successful and an annual loss of $2,000 if it is not. At the second location, the store will show an annual profit of $25,000 if it is successful and an annual loss of $5,000 if it is not. If the probability of success is 3/5 in the first location and 2/5 in the second location, where should the company open the new store so as to maximize expected profit?

I need to create a mathematical model to find the expectedprofit:
A band wants to hold a concert with an expected crowd of 3,000. The average spending on concessions is $15, tickets sell for $10. The profit is 80% at the gate, along with concession sales, minus a fixed cost of $10,000.

You know that there is a 40% probability that Microsoft will be selling for $22.50 three months from now and a 60% probability that it will be selling for $42.50. Microsoft does not pay a dividend. Currently, Microsoft is selling for $30. You are thinking of either buying 100 shares or selling short 100 shares. If you go lon

A contractor is considering a sale that promises a profit of $31,000 with a probability of 0.7 or a loss (due to bad weather, strikes, and such) of $13,000 with a probability of 0.3. What is the expectedprofit?

Essay; show all work. The property restoration company PuroServ is considering switching to new dehumidifiers. Their market research, considering the cost of the new machines and their efficiency, tells them that the switch would give them an 67% chance of making a $20,000 profit, a 3% chance of breaking even, and a 30% chance o

What would the present value of a business that earns the following profit be using a 5-yr life span and a 12% risk-adjusted discount rate.
yr 1 Expectedprofit received at end of yr $10,000?
yr 2 Expectedprofit received at end of yr $20,000?
yr 3 Expectedprofit received at end of yr $50,000?
yr 4 Expe

Ski resort profits $1,500,000 during a good winter with lots of snow. The resort has a loss of $500,000 otherwise. The resort's historical climate data suggests that the probability of a good winter with lots of snow during any given year is 40%. What is the expectedprofit for the ski resort?

A video rental store has two video cameras available for customers to rent. Historically, demand for cameras has followed this distribution. The revenue per rental is $40. If a customer wants a camera and none is available, the store gives a $15 coupon for tape rental.
Demand Relative Frequency Revenue Cost
0 .35 0 0
1 .25 40

If you purchase 5 gallons of skim milk for $2 per gallon and sell it for $3 per gallon and receive a refund for unsold milk of $1 per gallon.
y = Profit = NoSold(PriceSell-PriceRefund) + NoPurchased*(PriceRefund-PriceYouPurchasedFor)
What is the expectedprofit or loss for the following distribution of sales?
x 0

A building contractor pays $500 to bid on a contract. If he gets the contract, the probability of which he estimates to be 0.70, he will make a profit of $50,000. On the other hand, if he does not get the contract, he forfeits his $500. Find the contractor's expected net profit.