Probability and Statistics Basic Probability and Statistics Math Forum

 April 8th, 2019, 12:08 PM #1 Newbie   Joined: Apr 2019 From: FL Posts: 1 Thanks: 0 Please help me through this problem! Phil Dunphy, a real estate agent, is considering whether he should list an unusual $551,061 house for sale. If he lists it, he will need to spend$5,233 in advertising, staging, and fresh cookies. The current owner has given Phil 6 months to sell the house. If he sells it, he will receive a commission of $21,449. If he is unable to sell the house, he will lose the listing and his expenses. Phil estimates the probability of selling this house in 6 months to be 42%. What is the expected profit on this listing?  April 8th, 2019, 01:13 PM #2 Global Moderator Joined: May 2007 Posts: 6,770 Thanks: 700 Net=$.42\times 21449 - \$expenses.
April 8th, 2019, 02:28 PM   #3
Math Team

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Clearer(?):
Quote:
 Originally Posted by animeuncle Phil is considering whether he should list a house for sale. If he lists it, he will need to spend 5,233. The current owner has given Phil 6 months to sell the house. If he sells it, he will receive a commission of 21,449. If he is unable to sell the house, he will lose the listing and his expenses. Phil estimates the probability of selling this house in 6 months to be 42%. What is the expected profit on this listing?
Never seen such a problem; I'll go this way:

42% of (21449 - 5233) = 6810.72
-58% of 5233 = -3035.14

Expected profit = 6810.72 - 3035.14 = 3775.58

Well....I tried!!

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