Question

Please Help
Suppose you purchase a raffle ticket for $1.00. First prize is $5,000, second prize is $1,000, and third prize is $500. If 500 tickets are sold, what should you expect to win or lose? Round the answer to the nearest cent.




$0.99 loss



$13.00 loss



$10.00 gain



$12.00 gain

Answer 1

So, let's model this shall we?

First of all, how much is the total prize pool? Can you work that out for me?

Answer 2

They are giving out $6,500 in prize money and $500 worth of tickets are sold??

Answer 3

That's right, but more importantly, we have 500 competitors.

Answer 4

Now of course, the correct answer is $0, since we don't expect to win anything from this single raffle draw. However, what I believe the question is asking.. "if we played the raffle an infinite number of times, how much would we win.. on average.. each time?". That's a much better way the question should be worded.

So, to answer that. We must distribute $6500 among 500 competitors. So how much would each competitor win on average if they played the game an infinite number of time? (hint: $6500/500)

Answer 5

$13

Answer 6

That's right. Now. what was our investment (or cost) to play each time?

Answer 7

so the answer is B.?

Answer 8

Nope, answer my question first.

Answer 9

Each time we play, we win $13 on average. But we have to pay to play. How much do we pay to play?

Answer 10

it cost $1 to play each time

Answer 11

Great. So if we pay $1 to win $13, what is our total profit each time?

Answer 12

$12

Answer 13

Excellent!

Answer 14

Thank you!!!