Ask Question
14 November, 06:19

You buy a lottery ticket to a lottery that costs $10 per ticket. There are only 100 tickets available to be sold in this lottery. In this lottery there are one $460 prize, two $80 prizes, and four $20 prizes. Find your expected gain or loss.

+5
Answers (1)
  1. 14 November, 06:33
    0
    Expected Loss will be $3

    Explanation:

    Expected Loss can be calculated by multiplying the probabilities to Net expected outcome.

    Probabilities

    Prize ($460) = 1 / 100

    Prize ($80) = 2 / 100

    Prize ($20) = 4 / 100

    No prize = 100/100 - (1+2+4) / 100 = 93/100

    Expected value = [ (460 - 10) x 1/100 ] + [ (80 - 10) x 2/100 ] + [ (20 - 10) x 4/100 ] + [ (0 - 10) x 93/100] = 4.5 + 1.4 + 0.4 - 9.3 = - $3
Know the Answer?
Not Sure About the Answer?
Find an answer to your question ✅ “You buy a lottery ticket to a lottery that costs $10 per ticket. There are only 100 tickets available to be sold in this lottery. In this ...” in 📘 Business if you're in doubt about the correctness of the answers or there's no answer, then try to use the smart search and find answers to the similar questions.
Search for Other Answers