document.write( "<A HREF=/cgi-bin/jump-to-question.mpl?question=1198129>Question 1198129</A>: <I><SPAN STYLE=\"word-break: break-all;\"> Mark owns a stamp collection that he is considering getting insured. Over the course of a year it will cost him $500 to keep his collection insured, but if his collection is damaged they will pay him $1000.If he estimates there's a 10% chance of his collection being damaged, what is the expected value of buying the insurance policy? \r<BR>\n" );
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document.write( "One of the following is correct:<BR>\n" );
document.write( "A) $-490<BR>\n" );
document.write( "B) $10<BR>\n" );
document.write( "C) $-400<BR>\n" );
document.write( "D) $100<BR>\n" );
document.write( "Which one?<BR>\n" );
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document.write( "</I><HR><TABLE width=100%><TR><TD><B><A HREF=http://www.algebra.com/>Algebra.Com's</A> Answer #831663 by </B><A HREF=/tutors/aboutme.mpl?userid=MathLover1><B>MathLover1(20850)</B></A><img src=\"/images/stars/stars-13.gif\" alt=\"\" >&nbsp;<A HREF=/tutors/aboutme.mpl?userid=MathLover1><IMG SRC=http://www.algebra.com/images/aboutme-small.gif BORDER=0 alt=\"About Me\" VALIGN=MIDDLE></A>&nbsp;<IMG SRC=http://www.algebra.com/cgi-bin/show-face.mpl?user=MathLover1><BR>You can <A HREF=\"/cgi-bin/embed-solution.mpl?show=1&solution=831663\">put this solution on YOUR website!</A><BR><SPAN STYLE=\"word-break: break-all;\"> \r<BR>\n" );
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document.write( "Expected value of buying the insurance policy;\r<BR>\n" );
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document.write( "<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=EV ALIGN=MIDDLE  ALT=\"EV\"   DISABLED_style= \"max-width:90%; height:auto;\" > = expected benefits - insurance cost\r<BR>\n" );
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document.write( "<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=EV+=+xE+-+C ALIGN=MIDDLE  ALT=\"EV+=+xE+-+C\"   DISABLED_style= \"max-width:90%; height:auto;\" >\r<BR>\n" );
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document.write( "chances of collection being damaged <IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=x+=+10 ALIGN=MIDDLE  ALT=\"x+=+10\"   DISABLED_style= \"max-width:90%; height:auto;\" >% =<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=+0.1 ALIGN=MIDDLE  ALT=\"+0.1\"   DISABLED_style= \"max-width:90%; height:auto;\" >\r<BR>\n" );
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document.write( "Insurance cost <IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=C+=+500 ALIGN=MIDDLE  ALT=\"C+=+500\"   DISABLED_style= \"max-width:90%; height:auto;\" >\r<BR>\n" );
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document.write( "Benefit <IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=E+=+1000 ALIGN=MIDDLE  ALT=\"E+=+1000\"   DISABLED_style= \"max-width:90%; height:auto;\" >\r<BR>\n" );
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document.write( "Substituting the values;\r<BR>\n" );
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document.write( "<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=EV+=+0.1+%2A1000+-+500+=+100+-+500 ALIGN=MIDDLE  ALT=\"EV+=+0.1+%2A1000+-+500+=+100+-+500\"   DISABLED_style= \"max-width:90%; height:auto;\" >\r<BR>\n" );
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document.write( "<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=EV+=+-400 ALIGN=MIDDLE  ALT=\"EV+=+-400\"   DISABLED_style= \"max-width:90%; height:auto;\" >\r<BR>\n" );
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document.write( "The expected value of buying the insurance policy is $<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=-400 ALIGN=MIDDLE  ALT=\"-400\"   DISABLED_style= \"max-width:90%; height:auto;\" >.\r<BR>\n" );
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document.write( "answer:    C) $<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=-400 ALIGN=MIDDLE  ALT=\"-400\"   DISABLED_style= \"max-width:90%; height:auto;\" >\r<BR>\n" );
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