## anonymous 5 years ago 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 a 75% chance of making a $20,000 profit, a 20% chance of breaking even, and a 5% chance of losing$5,000. How much money does PuroServ expect to make with their new purchase? please show work

1. anonymous

dont worry

2. anonymous

some ons coming

3. anonymous

:D

4. anonymous

keebler I am sorry but I never did a question like this. I will try to get some help.

5. anonymous

its expected value, kind of like a weighted average $EV = \sum_{}^{}x*p(x)$ where x is profit made and p(x) is the probability of making that profit

6. anonymous

dumbcow i dont get it!!

7. anonymous

so (20,000)(0.75) + (0)(0.2) + (-5000)(0.05)

8. anonymous

multiply each probability by its corresponding profit

9. anonymous

:D

10. anonymous

it is easy

11. anonymous

thank u dumbcow

12. anonymous

no problem what do you get after adding them up

13. anonymous

hold on!

14. anonymous

it gave me a wired number!

15. anonymous

hmm should be 14,750 .75*20,000 - .05*5000