A fair coin is flipped 20 times. Your friend proposes a bet where if it lands on heads exactly 10 times, you win $4, but if it lands on heads 11 or more times or 9 or less times, you lose $1. Should you take the bet? In other words, find the expected value of the bet and if it is positive you should take it.

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22 August, 22:39

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Terrell Bradley · Answer 1

E[y]=∑yp (y) = 4 (0.176) + (-1) (0.824) = -.12 dollar, so In one play the player is expected to lose 12% of a dollar.