In a game of chance, the probability of winning a $50 is 40% and the probability of losing a $50 prize is 60%. what is the expected value of the prize in the game? $15 $25 $0 - $10

Question

Milton Sexton

Mathematics

5 November, 02:14

In a game of chance, the probability of winning a $50 is 40% and the probability of losing a $50 prize is 60%. what is the expected value of the prize in the game? $15 $25 $0 - $10

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Answers (1)

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Alena Calhoun · Answer 1

To calculate expected value,

We can add up the probability of all possible events.

The 2 possible events are either winning $50 or losing the prize, which is $ - 50

Expected value =

50 x 40 % + (-50) x 60%

= $-10

So the answer is $-10