Question

2.38 Baggage fees: An airline charges the following baggage fees: $30 for the first bag and $40 for the second. Suppose 52% of passengers have no checked luggage, 34% have only one piece of checked luggage and 14% have two pieces. We suppose a negligible portion of people check more than two bags.


a) The average baggage-related revenue per passenger is: $  (please round to the nearest cent)
b) The standard deviation of baggage-related revenue is: $  (please round to the nearest cent)
c) About how much revenue should the airline expect for a flight of 150 passengers? $  (please round to the nearest dollar)

Answer 1

from above:

x	P(x)	xP(x)	x2P(x)
0	0.5200	0.0000	0.0000
30	0.3400	10.2000	306.0000
70	0.1400	9.8000	686.0000
	total	20.0000	992.0000
	E(x) =μ=	ΣxP(x) =	20.0000
	E(x2) =	Σx2P(x) =	992.0000
	Var(x)=σ2 =	E(x2)-(E(x))2=	592.0000
	std deviation=	σ= √σ2 =	24.3311

a)

average baggage-related revenue per passenger is =20

b)

standard deviation of baggage-related revenue is =24.33

c)

expected revenue =150*20 =3000