SOLUTION: You are playing a game in which you flip a coin three times. It costs $3 to play the game, which must be subtracted from your winnings. Calculate the expected value for the game. I

Algebra ->  Probability-and-statistics -> SOLUTION: You are playing a game in which you flip a coin three times. It costs $3 to play the game, which must be subtracted from your winnings. Calculate the expected value for the game. I      Log On


   

Question 628951: You are playing a game in which you flip a coin three times. It costs $3 to play the game, which must be subtracted from your winnings. Calculate the expected value for the game. If all coins show the same side you win $7. If not, you lose your $3.
Answer by stanbon(75887) About Me  (Show Source):
You can put this solution on YOUR website!
You are playing a game in which you flip a coin three times. It costs $3 to play the game, which must be subtracted from your winnings. Calculate the expected value for the game. If all coins show the same side you win $7. If not, you lose your $3.
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Random "winning" values::::::::::4::::::::-3
Probabilities::::::::::::::::::::2/8::::::6/8
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Expected winnings: (2*4 - 6*3)/8 = -10/8 = -$1.25
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Cheers,
Stan H.