Our Department Store Is Having a Sale on Personal Computers

question 149

Essay

Our department store is having a sale on personal computers, of which three are in stock (no rain checks).There is a certain probability of selling none.The probability of selling one is twice as great as the probability of selling none.The probability of selling two is three times the probability of selling none.Finally, the probability of selling all the personal computers is four times as great as the probability of selling none.In a table, list the outcomes and their probabilities.Hint: Let the probability of selling none equal x.

Grasp the idea of economies and diseconomies of scope.

Appreciate the significance of returns to scale on long-run costs.

Recognize the role of technology and specialization in achieving economies of scale.

Identify conditions that lead to diseconomies of scale.