5. The diameter X of a manufactured part is an exponential random variable with parameter B. (Note that B = 1/2). If X<

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5 The Diameter X Of A Manufactured Part Is An Exponential Random Variable With Parameter B Note That B 1 2 If X 1 (19.22 KiB) Viewed 61 times

5. The diameter X of a manufactured part is an exponential random variable with parameter B. (Note that B = 1/2). If X< 1, manufacturer realizes a profit of $3, if X> 1 the part must be discarded at a net loss of $1. The machinery manufacturing the part may be set so that B = 4 or B = 2. Which setting will maximize the manufacturer's expected profit?