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The demand for a certain weekly magazine at a newsstand is

Fundamentals of Probability, with Stochastic Processes | 3rd Edition | ISBN: 9780131453401 | Authors: Saeed Ghahramani ISBN: 9780131453401 223

Solution for problem 7 Chapter 4.5

Fundamentals of Probability, with Stochastic Processes | 3rd Edition

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Fundamentals of Probability, with Stochastic Processes | 3rd Edition | ISBN: 9780131453401 | Authors: Saeed Ghahramani

Fundamentals of Probability, with Stochastic Processes | 3rd Edition

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Problem 7

The demand for a certain weekly magazine at a newsstand is a random variable with probability mass function p(i) = (10i)/18, i = 4, 5, 6, 7. If the magazine sells for $a and costs $2a/3 to the owner, and the unsold magazines cannot be returned, how many magazines should be ordered every week to maximize the profit in the long run?

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Solution for Assignment # 3 Sta 5206, 5126 & 4202 Solution for Problem 1 (a) Source Degrees of Sums of Mean F P Freedom Squares Square A 1 0.322 0.322 0.04 0.845 B 2 80.554 40.2771 4.59 0.033 A*B 2 45.348 22.674 2.58 0.117 Error 12 105.327 8.7773 Total 17 231.551 (b) 3 levels were used for Factor B. 18 (c) N=a*b*n => n= ∗ = 2∗3= 3. Therefore 3 replicates of the experiment were performed. (d) H 0

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Chapter 4.5, Problem 7 is Solved
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Textbook: Fundamentals of Probability, with Stochastic Processes
Edition: 3
Author: Saeed Ghahramani
ISBN: 9780131453401

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The demand for a certain weekly magazine at a newsstand is