1. On average, retailers expect to sell the same amount on the first weekend and the second weekend.
2. If retail sales are exceptionally low on the first weekend, retailers expect lower than average sales on the following weekend.
3. The standard deviation of total sales over two consecutive weekends is 2 s.
4. The difference between the amount sold on the first weekend X1 and the amount sold on the second weekend X2 is less variable than the total amount sold.
5. If a promotion were to introduce negative dependence between the amounts sold on two weekends, then we would need the correlation in order to find E(X2 - X1).
6. If a promotion were to introduce negative dependence between the amounts sold on two weekends, then we would need the correlation or covariance in order to find Var (X2 - X1).
As a baseline when planning future advertising, retail executives treat the dollar values of sales on consecutive weekends as iid random variables. The amounts sold on two consecutive weekends (call these X1 and X2) are independent and identically distributed random variables with mean m and standard deviation σ.