Uni-Trax Publishers allows its sales team to buy and sell shares that pay out $1 only if the sales in the future fall within a certain range. Suppose that currently shares for sales between 1,000 books and 2,000 books are selling for 10 cents each. Shares for sales between 2,000 and 3,000 books are selling for 30 cents each. Shares for sales between 3,000 and 4,000 books are selling for 40 cents each. Based on this information, what is the probability of Uni-Trax Publishers selling between 2,000 and 4,000 textbooks?
A) 10 percent
B) 40 percent
C) 70 percent
D) 30 percent

Question

Quizplus · Accepted Answer

The probability of selling between 2,000 and 4,000 books is the sum of the probabilities of selling between 2,000 and 3,000 books and between 3,000 and 4,000 books. The prices of the shares reflect these probabilities: 30 cents for 2,000-3,000 books and 40 cents for 3,000-4,000 books, totaling 70 cents, which corresponds to a 70 percent probability.

Uni-Trax Publishers Allows Its Sales Team to Buy and Sell