Buying books on Ebay. The textbook you need to buy for your chemistry class is expensive at the college bookstore, so you consider buying it on Ebay instead. A look at past auctions suggest that the prices of that chemistry textbook have an approximately normal distribution with mean $89 and standard deviation $15.
(a) What is the probability that a randomly selected auction for this book closes at more than $100?
(b) Ebay allows you to set your maximum bid price so that if someone outbids you on an auction you can automatically outbid them, up to the maximum bid price you set. If you are only bidding on one auction, what are the advantages and disadvantages of setting a bid price too high or too low? What if you are bidding on multiple auctions?
(c) If you watched 10 auctions, roughly what percentile might you use for a maximum bid cuto↵ to be somewhat sure that you will win one of these ten auctions? Is it possible to find a cutoff point that will ensure that you win an auction?
(d) If you are willing to track up to ten auctions closely, about what price might you use as your maximum bid price if you want to be somewhat sure that you will buy one of these ten books?