Question

On the basis of 5 years of data, the following probability function for a company weekly demand for wool was:

Amount (kg) 2500 3500 4500 5500

Probability 0.35 0.45 0.20 0.05

What was the expected weekly demand for wool based on the distribution?

Answer 1

$E(X)=\Sigma x_i p_i=2500*0.35+3500*0.45+4500*0.20+5500*0.05=3625.$