Question 1152680
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m = profit earned after winning
P(winning) = 0.60 is the probability of winning
P(losing) = 0.40
V(winning) = value of winning
V(winning) = m
V(losing) = -1, meaning you lost 1 dollar


E(x) = expected value
E(x) = P(winning)*V(winning) + P(losing)*V(losing)
E(x) = 0.60*m + 0.40*(-1)
E(x) = 0.60*m - 0.40


We want this to be a fair game, so the expected value should be 0
E(x) = 0
0.60*m - 0.40 = 0
0.60*m = 0.40   .......... add 0.40 to both sides
m = 0.40/0.60   .......... divide both sides by 0.60
m = 0.66667 approximately
m = 0.67


When you win the game, the profit should be $0.67 (or 67 cents) to ensure a fair game.
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