Dina's Ice Cream Shop sells only chocolate and vanilla ice cream. Each week. Dina puts either chocolate ice cream or vanilla ice cream on sale. She is trying to figure out which ice cream she should put on sale this
week
Dina gets all of her business from people who walk by her ice cream shop and stop in. She performs some
market research and asks 100 different people if they would purchase chocolate ice cream, vanilla ice
cream, or no ice cream if they walled by and chocolate ice cream was on sale. She does the same for varilla
ice cream being on sale
Should
This week a total of 500 people will walk by Dina's Ice Cream Shop
What is Dina's expected profit if she puts chocolate ice cream on sale?
What is Dina's expected profit if she puts vanilla ice cream on sale? $
V
Ice cream on sale.
To maximize her expected profit, Dina should put
Chocolate on sale Vanilla on sale
Profit from chocolate $2.00
$3.00
Profit from vanilla $2.00 $1.00
The following table shows the results from her market research
Customer choice Chocolate on sale Vanilla on sale
Chocolate
61
16
Vanilla
12
73
No ice cream
27
11
Total
100
100