Question 1166589: In a state's Pick 3 lottery game, you pay $0.86 to select a sequence of
three digits (from 0 to 9), such as 977. If you select the same sequence of
three digits that are drawn, you win and collect $301.25. Answer the
following questions.
complete the table
expected win
expected loss
Answer by Edwin McCravy(20054)   (Show Source):
You can put this solution on YOUR website!
The numbers 000, 001, 002, ..., 999 is 1000 possibilities.
My probability of choosing the right sequence from those is 1/1000 or 0.001
Winning or loss probability Expectation
$300.39 0.001 $300.39(0.001)=$0.30039 <--expected win
-$ 0.86 0.999 -$ 0.86(0.999)=$0.85914 <--expected loss
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Total expectation=-$0.55875
You can expect to average losing about 56 cents per play if
you play many times. When you lose 999 times and win 1 time
it'll only reimburse you for $301.25 of the $860 you've paid
to play.
Edwin
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