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: 33b

Answer

118 million.

Work Step by Step

We must have $E(prize)\gt1$ $E(prize)\gt1$ $(grand~prize)\times0.00000000684+200,000\times0.00000028+10,000\times0.000001711+100\times0.000153996+7\times0.004778961+4\times0.007881463+3\times0.01450116+0\times0.9726824222\gt1$ $(grand~prize)\times0.00000000684+0.197\gt1$ $(grand~prize)\times0.00000000684\gt1-0.197$ $(grand~prize)\times0.00000000684\gt0.803$ $(grand~prize)\gt\frac{0.803}{0.00000000684}$ $(grand~prize)\gt\frac{0.803}{0.00000000684}$ $(grand~prize)\gt117,397,660.82$ That is, the grand prize must be at least 118 million so that $E(profit)\gt0$
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