Answer:
The probability of selling two units is 0.7.
Step-by-step explanation:
It is given that in a single-period inventory situation, the probabilities of demand being 1, 2, 3, or 4 units are 0.3, 0.3, 0.2, and 0.2, respectively.
It means,
[tex]P(1)=0.3[/tex]
[tex]P(2)=0.3[/tex]
[tex]P(3)=0.2[/tex]
[tex]P(4)=0.2[/tex]
If two units are stocked, both of them are sold. It means the demand must be 2 or greater than 2.
The probability of selling two units is
[tex]P=P(2)+P(3)+P(4)[/tex]
Substitute the given probabilities in the above formula.
[tex]P=0.3+0.2+0.2[/tex]
[tex]P=0.7[/tex]
Therefore the probability of selling both of them is 0.7.
