A lottery has a grand prize of $140,000, three runner-up prizes of $14,000 each, seven third-place prizes of $3500 each, and twenty-five consolation prizes of $350 each. if 700,000 tickets are sold for $1 each and the probability of any one ticket winning is the same as that of any other ticket winning, find the expected net winnings on a $1 ticket.

Question

Rhys Salas

English

31 August, 07:34

A lottery has a grand prize of $140,000, three runner-up prizes of $14,000 each, seven third-place prizes of $3500 each, and twenty-five consolation prizes of $350 each. if 700,000 tickets are sold for $1 each and the probability of any one ticket winning is the same as that of any other ticket winning, find the expected net winnings on a $1 ticket.

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Angel Hubbard · Answer 1

Total cost of 700000 tickets = $1 x 700000 = $700000 Total prize money = 140000 + 3 x 14000 + 7 x 3500 + 25 x 350 = $215250 Hence expected winnings per dollar = Total prize / Total cost of tickets = 215250 / 700000 = 0.3075$ Hence expected bet winnings on a 1$ ticket = $0.3075