Question
A clothing store manufactures their pants to a certain specification of fit. If the fit is perfect, they sell them for full price in their
A clothing store manufactures their pants to a certain specification of fit. If the fit is perfect, they sell them for full price in their stores at $80 per pair of pants. If the pant legs are the incorrect length or the waist is not correct, they will sell them in their outlet store for $25. If the waist and length are not correct, they cannot be sold. They will send them to be recycled and that will cost them $5 per pair. The probability that the length of the pants is perfect is 0.78 and the probability that the waist is perfect is 0.88.
Show the probability function for 0, 1 and 2 defects as a graph (draw this by hand and label appropriately). (10 points)
Draw a graph of the cumulative distribution.(10 points)
On average, what should the company expect to make on each pair of pants? (15 points)
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