A Purchasing Agent for a Trucking Company Is Shopping for Replacement

question 9

Multiple Choice

A purchasing agent for a trucking company is shopping for replacement tires for their trucks from two suppliers. The suppliers' prices are the same. However, Supplier A's tires have an average life of 60,000 miles with a standard deviation of 10,000 miles. Supplier B's tires have an average life of 60,000 miles with a standard deviation of 2,000 miles. Which of the following statements is true?

• A) The two distributions of tire life are the same
• B) On average, Supplier A's tires have a longer life then Supplier B's tires
• C) The life of Supplier B's tire is more predictable than the life of Supplier A's tires
• D) The dispersion of Supplier A's tire life is less than the dispersion of Supplier B's tire life

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Definitions:

Payoff

The gain or loss that an investor or a player in a game receives as a result of a particular action or decision.

Nash Equilibrium

A concept in game theory where no player can benefit by changing their strategy if the strategies of the other players remain unchanged.

Payoff

The return or reward from an investment or decision, often evaluated in terms of profit or benefit gained.

Nash Equilibrium

A concept in game theory where no player can benefit by changing strategies if other players keep their strategies unchanged.