Scary Airline predicts that the annual probability of one of its jets being destroyed in a crash is 1 in 10 million. If destroyed, the value of the property damage to the plane equals $50 million. Assume that there are no partial losses; the plane is either destroyed in a crash or suffers no loss.

Show the physical damage loss distribution for Scary Airline's planes.
Calculate the expected value of the physical damage loss.
Show the calculations for the variance and the standard deviation.

(A) The expected loss is $5 million.

(B) The variance and standard deviation of physical damage loss are $225 million and $15 million respectively.

Step-by-step explanation:

The annual probability of Scary Airline's jets being destroyed is 1 in 10 million, i.e 0.0000001.

It is assumed that the jet is either destroyed or there was no loss suffered.

The loss amount in case the jet is destroyed is, $50 million.

(A)

The distribution for physical damage loss is displayed in the table below.

The Expected value of physical damage loss is:

Thus, the expected loss is $5 million.

(B)

The variance of a random variable X is: Var (X) = E (X²) - [E (X)]².

Compute the variance as follows:

The standard deviation of physical damage loss is:

Thus, the variance and standard deviation of physical damage loss are $225 million and $15 million respectively.

step-by-step explanation:

step-by-step explanation:

3024 rhe base is what up in worry about