Rajesh has just bought a VCR from Maharashtra Electronics and the shop offers after sales service contract…

Rajesh has just bought a VCR from Maharashtra Electronics and the shop offers after sales service contract for Rs. 1000 for the next five years. Considering the experience of VCR users, the following distribution of maintenance expenses for the next five years is formed. The expected value of maintenance cost is
  1. Rs. 800
  2. Rs. 770
  3. Rs. 700
  4. Rs. 900

Solution

$\begin{aligned} & \text { Expected value }=\sum \mathrm{p}_{\mathrm{i}} \mathrm{x}_{\mathrm{i}} \\ & =(0)(0.35)+(500)(0.25)+(1000)(0.15)+(1500)(0.1) \\ & +(2000)(0.08)+(2500)(0.05)+(3000)(0.02) \\ & =0+125+150+150+160+125+60=770\end{aligned}$

Asked in: MHT CET 2021 (20 Sep Shift 1)

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