June's Specialty Shop Sells Designer Original Dresses

Essay

June's Specialty Shop sells designer original dresses. On 10% of her dresses, June makes a profit of $10, on 20% of her dresses she makes a profit of $20, on 30% of her dresses she makes a profit of $30, and on 40% of her dresses she makes a profit of $40. On a given day, the probability of June having no customers is .05, of one customer is .10, of two customers is .20, of three customers is .35, of four customers is .20, and of five customers is .10.
a. What is the expected profit June earns on the sale of a dress?
b. June's daily operating cost is $40 per day. Find the expected net profit June earns per day. (Hint: To find the expected daily gross profit, multiply the expected profit per dress by the expected number of customers per day.)
c. June is considering moving to a larger store. She estimates that doing so will double the expected number of customers. If the larger store will increase her operating costs to $100 per day, should she make the move?