Question

A new car battery is sold with a two-year warranty whereby the owner gets the battery replaced free of cost if it breaks down during the warranty period. Suppose an auto store makes a net profit of $20 on batteries that stay trouble-free during the warranty period; it makes a net loss of $10 on batteries that break down. The life of batteries is known to be normally distributed with a mean and a standard deviation of 40 and 10 months, respectively. a. What is the probability that a battery will break down during the warranty period? b. What is the expected profit of the auto store on a battery? c. What is the expected monthly profit on batteries if the auto store sells an average of 500 batteries a month

          A new car battery is sold with a two-year warranty whereby the
owner gets the battery replaced free of cost if it breaks down
during the warranty period. Suppose an auto store makes a net
profit of $20 on batteries that stay trouble-free during the
warranty period; it makes a net loss of $10 on batteries that break
down. The life of batteries is known to be normally distributed
with a mean and a standard deviation of 40 and 10 months,
respectively. 
a. What is the probability that a battery will break down during
the warranty period?
b. What is the expected profit of the auto store on a
battery? 
c. What is the expected monthly profit on batteries if the auto
store sells an average of 500 batteries a month

Added by Joshua K.

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