document.write( "Question 756383: An oil-drilling company knows that it costs $25,000 to sink a test well. If oil is hit, the income for the drilling company will be $395,000. If only natural gas is hit, the income will be $130,000. If nothing is hit, there will be no income. If the probability of hitting oil is 1/40 and if the probability of hitting gas is 1/20, what is the expectation for the drilling company? \n" ); document.write( "
Algebra.Com's Answer #460180 by stanbon(75887)\"\" \"About 
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An oil-drilling company knows that it costs $25,000 to sink a test well. If oil is hit, the income for the drilling company will be $395,000. If only natural gas is hit, the income will be $130,000. If nothing is hit, there will be no income. If the probability of hitting oil is 1/40 and if the probability of hitting gas is 1/20, what is the expectation for the drilling company?
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\n" ); document.write( "Random \"gain\" values in thousands:.....-25........395........130
\n" ); document.write( "Corresponding probabilities:::::::.....(37/40)....(1/40......(2/40)\r
\n" ); document.write( "\n" ); document.write( "E(gain) = [37*-25 + 395 + 2*130]/40 = -270 thousand dollars
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\n" ); document.write( "Cheers,
\n" ); document.write( "Stan H.
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