8 A large car dealership in Bloomington, Indiana, employsfive salespeople. All salespeople work on commission; they are
Question:
8 A large car dealership in Bloomington, Indiana, employsfive salespeople. All salespeople work on commission; they are paid a percentage of the profits from the cars they sell.
The dealership has three types of cars: luxury, midsize, and subcompact. Data from the past few years show that the car sales per week per salesperson have the distribution in Table 24. If the car sold is a subcompact, a salesperson is given a commission of $250. For a midsize car, the commission is either $400 or $500, depending on the model sold. On the
midsize cars, a commission of $400 is paid out 40% of the time, and $500 is paid out the other 60% of the time. For a luxury car, commission is paid out according to three separate rates: $1,000 with a probability of 35%, $1,500 with a probability of 40%, and $2,000 with a probability of 25%. If the distribution of type of cars sold is as shown in Table 25, what is the average commission for a salesperson in a week?
Step by Step Answer:
Operations Research Applications And Algorithms
ISBN: 9780534380588
4th Edition
Authors: Wayne L. Winston