Tutor profile: Joe M.

In a binomial distribution, how would you find the expected value and standard deviation of a sample n=20 and probability of success of p=.85?

Expected value = 17 [20(.85)] = n*p Standard Deviation = sq root (n*p*(1-p)) = sq rt.(20*.85*(1-.85)) = 1.597

How does selling inventory on account affect the financial statements?

For the balance sheet, the assets account will decrease in the inventory account and increase by the same amount for accounts receivable. On the income statement, sales will increase and cost of good sold by the same amount. This will flow down to the statement of retained earnings.

How would the demand for an inelastic good change as the price of the good changed? Provide a supply/demand graph.

Even as price changes drastically for a product, the demand for the product does not see much fluctuation. If the price elasticity of a product is equal to 0, it is perfectly inelastic; demand will not change as price changes. The closer to 1 the price elasticity becomes, the less inelastic the product is. The demand curve will be perfectly vertical for a perfectly inelastic good.