A Retailer Purchases 140 of a New Brand of DVD

question 8

Multiple Choice

A retailer purchases 140 of a new brand of DVD player, of which 4 are defective. The purchase agreement says that if he tests 8 chosen at random and finds 1 or more defective, he receives all the DVD players free of charge. What is the probability that he will not have to pay for the DVD players? Round your answer to three decimal places. ​

• A)0.521
• B)0.212
• C)1.000
• D)0.788
• E)0.168

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Definitions:

Unit Price

The cost per unit of a product or service.

Constant Cost

An economic scenario where the cost of producing an additional unit of a good or service remains unchanged, regardless of the scale of production.

Equilibrium Quantity

The quantity of goods supplied is equal to the quantity demanded at a given price level.

Equilibrium Price

The price at which the quantity of a good supplied equals the quantity demanded, resulting in no surplus or shortage in the market.