SOLUTION: One thousand raffle tickets are sold for $5.00 each. One grand prize of $1000 and two consolation prizes of $200 each will be awarded. Jeremy purchases one ticket. Find his expecte
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-> SOLUTION: One thousand raffle tickets are sold for $5.00 each. One grand prize of $1000 and two consolation prizes of $200 each will be awarded. Jeremy purchases one ticket. Find his expecte
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Question 445456: One thousand raffle tickets are sold for $5.00 each. One grand prize of $1000 and two consolation prizes of $200 each will be awarded. Jeremy purchases one ticket. Find his expected value. Show your work for full credit. Found 2 solutions by ewatrrr, Edwin McCravy:Answer by ewatrrr(24785) (Show Source):
Hi
Note: in red: prize amount - the $5 cost of the ticket
One thousand raffle tickets are sold for $5.00 each.
One grand prize of $1000 and two consolation prizes of $200 each will be awarded.
total prize money awarded = $1000, $200, 200
E(X)=∑X*P(X) =
= .995 + .195 + .195 - 4.985 = -$3.60
You can put this solution on YOUR website! One thousand raffle tickets are sold for $5.00 each. One grand
prize of $1000 and two consolation prizes of $200 each will be
awarded. Jeremy purchases one ticket. Find his expected value.
Show your work for full credit.
[The other tutor forgot to subtract the price of the ticket from the
winnings, so her answer was a penny short of the expected loss of
$3.60.]
Event x = winning P(x) xP(x)
------------------------------------------------------------
wins grand prize $995 1/1000 995/1000
wins a consolation prize $195 2/1000 390/1000
doesn't win -$5 997/1000 -4985/1000
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E(x) = ΣxP(x) = -3600/1000 = -$3.60
If a raffle exactly like this one were held many times, and Jeremy bought
one ticket every time, then he would expect to average having lost $3.60
per time he entered.
Edwin
