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eBay
A collector purchased a quantity of action figures and is going to sell them on eBay. He has 19 Hulk figures. In recent auctions, the mean selling price of similar figures has been $12.11, with a standard deviation of $1.38. He also has 13 Iron Man figures which have had a mean selling price of $10.19, with a standard deviation of $0.77.
His insertion fee will be $0.55 on each item, and the closing fee will be 8.75% of the selling price. He assumes all will sell without having to be relisted.
a) Define your random variables, and use them to create a random variable for the collector's net income.
b) Find the mean (expected value) of the net income.
c) Find the standard deviation of the net income.
d) Do you have to assume independence for the sales on eBay? Explain.
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