Statistics: Informed Decisions Using Data (4th Edition)

Published by Pearson
ISBN 10: 0321757270
ISBN 13: 978-0-32175-727-2

Chapter 6 - Section 6.1 - Assess Your Understanding - Applying the Concepts - Page 332: 33a

Answer

$E(prize)=0.30$ $E(profit)=-0.70$ It is expected that I will win a prize of 0.30 for each ticket that I buy, I will lose 0.70 for each ticket that I buy.

Work Step by Step

$E(prize)=E(X)=μ_X=Σ[x.P(x)]=15,000,000\times0.00000000684+200,000\times0.00000028+10,000\times0.000001711+100\times0.000153996+7\times0.004778961+4\times0.007881463+3\times0.01450116+0\times0.9726824222=0.30$ $E(profit)=E(prize)-ticket~price=0.30-1=-0.70$
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