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anonymous

  • 5 years ago

One thousand raffle tickets are sold for $2.00 each. One grand prize of $800 and two consolation prizes of $100 each will be awarded. Jeremy purchases one ticket. Find his expected value.

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  1. anonymous
    • 5 years ago
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    $-1 Total prizes: $1000 Total tickets: $1000 prize/ticket = $1 Price paid = $2 $1-$2 = -$1

  2. anonymous
    • 5 years ago
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    Result Net outcome Probability Win grand prize $798 1/1000 Win consol. prize $98 2/1000 Lose $-2 997/1000 Multiply net outcome by probability and add 798*1/1000 + 98*2/1000 + -2*997/1000 = $-1

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