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Pass HP2-H75 Exam Cram

Exam Code: HP2-H75

Exam Name: Selling HP Healthcare Solutions 2018 (UK)

Version: V15.35

Q & A: 208 Questions and Answers

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NEW QUESTION: 1
During the past few gears, Wilder Company has experienced the following average number of power outages:

Each power outage results in out-of-pocket costs of U $300. For U $1,000 per month, At US
$800 can lease generator to provide power during outages. If Wilder leases a generator in the coming year, the estimated savings or additional expense) for the year will be:
A. U $ 15,200)
B. U $7,200
C. U $3,200
D. US $ 1,267)
Answer: C
Explanation:
Each outage costs US $800, but this experience can be avoided by paying US $1,000 per month US $12,000 for the year). The expected-value approach uses the probability distribution derived from past experience to determine the average expected outages per month.

The company can expect to have, on average, 1.58334 outages per month. At US $800 per outage, the expected costs is US $1,266.67. Thus, paying US $1,000 to avoid an expense of US $1,266.67 saves US $266.67 per month, or US $3,200 per year.

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