Question
Gabelli Partners is planning a major investment. The amount of profit X is uncertain but a probabilistic estimate gives the following distribution (in millions of
Gabelli Partners is planning a major investment. The amount of profit X is uncertain but a probabilistic estimate gives the following distribution (in millions of dollars):
Profit 1, 1.5, 2, 4, 10
Probability 0.1, 0.2, 0.4, ??, 0.1
a. Find P(X = 4) = 0.2
b. Find the mean profit and the standard deviation of the profit.
c. Gabelli Partners owes its source of capital a fee of $200,000 plus 10% of the profits X. So thefirm actually retains Y = 0.9X 0.2 from the investment. Find the mean and standard deviation of Y
Please explain the steps! Thank you!
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