Question

One thousand raffle tickets are sold for $1.00 each. One grand prize of $400 and two consolation prizes of $100 each will be awarded. Jeremy purchases one ticket. Find his expected value.

Answer 1

expected value is what you win times probability you win it added up

Answer 2

or you can simply imagine you bought all the tickets. you would spend 1000 and win one 400 prize and two 100 prizes for a grand total of 600. you spent 1000, you won 600 for a net loss of 400 averaged over the 1000 tickets this is -.4 or -40 cents per ticket

Answer 3

ok that makes sense...

Answer 4

in simple english he expects to lose 40 cents

Answer 5

ok... i understand that.. thank you.. :)

Answer 6

i hope your teacher or whomever doesn't want you to say the expected value is .60 that ignores the fact that you spent $1.00

Answer 7

who knows. the prof dont explain anything... i am completely bombing this class.. :(

Answer 8

we can write this using just probability if you like

Answer 9

it amounts to the same thing exactly. the probability you lose your $1 is \[\frac{997}{1000}=.997\] the probability you win $399 is
\[\frac{1}{1000}=.001\] (i wrote $399 because you do not get your dollar back too!) and the probability you win $99 is
\[\frac{2}{1000}=.002\]

Answer 10

expected value is
\[-1\times .997+399\times .001+99\times .002=-.4\]

Answer 11

basically its the same outcome.. just broke down in a different way

Answer 12

yes first way you can almost do in your head. second way requires some calculation

Answer 13

is it just a probability class?

Answer 14

no its a college mathematics.. this week is about probability

Answer 15

right one from column a and one from column b. chinese menu math nothing is worse

Answer 16

it is a 6 week course and were in week 4 right now.. i think im catching on and then i end up bombing big time.. its getting frustrating.. big time.

Answer 17

good luck!

Answer 18

thank you!