Suppose you pay $50 to enter into a raffle with $1,000 prize. If you have a 3% chance of winning comma the expected value of your ticket is________.

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abiolataiwo2015 abiolataiwo2015 · Answer 1 · 2021-07-26T02:39:47+02:00

Answer:

$-20

Explanation:

Calculation to determine the expected value of your ticket

Using this formula

Expected Value =∑ payoff *Probability

Let plug in the formula

Expected value of ticket =950 ∗.03+(−50) ∗(100%-3%)

Expected value of ticket =950 ∗.03+(−50) ∗.97

Expected value of ticket=−20.

Therefore the expected value of your ticket is $-20

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anthougo anthougo · Answer 2 · 2022-03-18T13:57:05+01:00

The expected value of your ticket is -$20.

The expected value is the summation of the multiplication of some random values with their probabilities of occurring.

The expected value estimates the chance that a favorable outcome will result.

Note that the cost of entering the raffle must be incurred whether the prize is won or not.

Cost for raffle = $50

Prize for raffle = $1,000

Probability of winning = 3%

Probability of losing = 97% (100% - 3%)

Expected value of winning = -$20 ($1,000 x 3% -$50)

Thus, the expected value of your ticket is -$20.

Learn more about probabilities and expected values at https://brainly.com/question/10675141