The New Owner of a Beauty Shop Is Trying to Decide

question 57

Multiple Choice

The new owner of a beauty shop is trying to decide whether to hire one, two, or three beauticians. She estimates that profits next year (in thousands of dollars) will vary with demand for her services, and she has estimated demand in three categories, low, medium, and high.
If she feels the chances of low, medium, and high demand are 50 percent, 20 percent, and 30 percent respectively, what are the expected annual profits for the number of beauticians she will decide to hire?

• A) $54,000
• B) $55,000
• C) $70,000
• D) $50,000
• E) $154,000

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Definitions:

Association

A connection or linkage between thoughts, ideas, feelings, or memories, influenced by experiences or learning.

Spontaneous Recovery

The reappearance of a previously extinguished response after a period of non-exposure to the conditioned stimulus.

Classical Conditioning

A learning process that occurs through associations between an environmental stimulus and a naturally occurring stimulus, famously demonstrated by Ivan Pavlov.

Conditioned Response

A learned reaction to a formerly neutral stimulus that has become conditioned after being paired with an unconditioned stimulus that naturally produces a response.