Suppose you are given the option of choosing from two production procedures. Both have possibilities that follow a normal distribution. One has mean profit of $280 and standard deviation $10.Theother has mean $280 and standard deviation $40.
a) Which one would you choose if you want the lowest chance of a profit of less than $200?
b) Say that the first production plan has mean profit $280 and standard deviation $10, but that the second has mean $300 and standard deviation of $80. Which one would you choose, if you prefer the production plan with the lowest probability of earning less than $240.