Question
A door-to-door salesman visits 50 homes each day, and has a 5% chance of making a sale at each home, independent of other visits. He
A door-to-door salesman visits 50 homes each day, and has a 5% chance of making a sale at each home, independent of other visits. He earns $2 per house visited, as well as a $50 commission on each sale. Calculate: (a) The expected value and standard deviation of the salesman's daily income, D. (b) The expected value and standard deviation of the salesman's weekly income, W, assuming that he works five days a week. (c) Calculate the ratios D/E[D] and W /E[W]. You can think of these as measures of the relative width of each distribution. What does this imply about the salesman's income?
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