Join TSR now and get all your revision questions answeredSign up now

Don't quite understand the calculation of risk.

    • Thread Starter
    Offline

    1
    ReputationRep:
    Howdy , I don't get the below attachment. I can calculate it using the formula but I don't get what the risk number means.

    For question b(i) and (ii), the P x C = risk is 37.5 but is this £37.5 a year or just a number to assess the risk? I am stuck in trying to compare it to the insurance cost of £30 a year.

    Could someone explain it please?

    Thanks
    Attached Images
     
    • Thread Starter
    Offline

    1
    ReputationRep:
    bump
    Offline

    3
    (Original post by marcus888)
    bump
    The meanings will be the same as in part a).

    Risk seems to mean "expected cost".

    The 37.5 is the expected cost of repairs required in total over the whole three years.

    With a 25% failure rate, the chances of more than one break down is considerable, but for the sake of the question, I think you're going to have to assume, if it breaks down then it will only do so once.

    Also, as I read it, the insurance cost is not £30 per year, but rather £30 in total to cover the whole three years.
    Offline

    3
    ReputationRep:
    What an awful definition of risk.
    • Thread Starter
    Offline

    1
    ReputationRep:
    (Original post by ghostwalker)
    The meanings will be the same as in part a).

    Risk seems to mean "expected cost".

    The 37.5 is the expected cost of repairs required in total over the whole three years.

    With a 25% failure rate, the chances of more than one break down is considerable, but for the sake of the question, I think you're going to have to assume, if it breaks down then it will only do so once.

    Also, as I read it, the insurance cost is not £30 per year, but rather £30 in total to cover the whole three years.
    Ah thanks for clearing that up. Makes sense now .
 
 
 
Poll
Do you have exam superstitions?
Useful resources

Make your revision easier

Maths

Maths Forum posting guidelines

Not sure where to post? Read the updated guidelines here

Equations

How to use LaTex

Writing equations the easy way

Student revising

Study habits of A* students

Top tips from students who have already aced their exams

Study Planner

Create your own Study Planner

Never miss a deadline again

Polling station sign

Thinking about a maths degree?

Chat with other maths applicants

Can you help? Study help unanswered threads

Groups associated with this forum:

View associated groups

The Student Room, Get Revising and Marked by Teachers are trading names of The Student Room Group Ltd.

Register Number: 04666380 (England and Wales), VAT No. 806 8067 22 Registered Office: International House, Queens Road, Brighton, BN1 3XE

Quick reply
Reputation gems: You get these gems as you gain rep from other members for making good contributions and giving helpful advice.