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    Bayes Theorem Calculations

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    Experience has shown a company that the cost of delivering a small package within 24 hours is $14.80. The company charges $15.50 for shipment but guarantees to refund the charge if delivery is not made within 24 hours. If
    the company fails to deliver only 2% of its packages within the 24-hour period, what is the expected gain per package?

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    https://brainmass.com/statistics/bayesian-probability/bayes-theorem-calculations-7197

    Solution Preview

    Let X denote the gain of delivering a small package within 24 hours. Then X is a random variable, from the hypothesis, we ...

    Solution Summary

    Experience has shown a company that the cost of delivering a small package within 24 hours is $14.80. The company charges $15.50 for shipment but guarantees to refund the charge if delivery is not made within 24 hours. If
    the company fails to deliver only 2% of its packages within the 24-hour period, what is the expected gain per package?

    $2.49

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