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Answer to Question #28449 in Statistics and Probability for Linda

Question #28449
A researcher hypothesizes that people who listen to music via headphones have greater hearing loss and will thus score lower on a hearing test than those in the general population. On a standard hearing test, the overall mean for the general population is 22.5. The researcher gives this same test to a random sample of 12 individuals who regularly use headphones. Their scores on the test are 15, 14, 20, 20, 25, 22, 21, 19, 16, 17, 21, 22.
Expert's answer
a) Breakeven output will be in point, where TR = TC,
TR = 18Q, TC = 3,500,000 + 10Q
TR = TC
18Q = 3,500,000 + 10Q
8Q = 3,500,000
Q = 437,500
In dollars: 437,500*18 = $7,875,000 is the breakeven output.
b) for $1,500,000 profit:
TR = TC + 1,500,000
18Q = 5,000,000 + 10Q
8Q = 5,000,000
Q = 625,000 units
c) If Q = 400,000:
Leverage = 18*400,000 - 3,500,000 - 10*400,000 = -$300,000
d) The probability will be = (362,500 + 100,000 - 437,500)/100,000 = 25% for
incurring of loss

(d) Assuming that sales of oil are normally distributed with a mean of
362,500 barrels and a standard deviation of 100,000 barrels, determine the
probability that Offshore will incur an operating loss.

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