A community for students.

Here's the question you clicked on:

55 members online
  • 0 replying
  • 0 viewing

anonymous

  • one year ago

1. A group holds a raffle to raise money. They sell 100 raffle tickets for $5 each. There is one grand prize worth $100, three second place prizes worth $25 each and five 3rd place prizes worth $10 each. Find the expected value associated with the purchase of one ticket. (Remember to subtract the cost of playing from your winnings)

  • This Question is Closed
  1. anonymous
    • one year ago
    Best Response
    You've already chosen the best response.
    Medals 0

    anyone can help me?

  2. anonymous
    • one year ago
    Best Response
    You've already chosen the best response.
    Medals 0

    HELP ME PLZZZ

  3. Valpey
    • one year ago
    Best Response
    You've already chosen the best response.
    Medals 0

    Okay, how much do they collect in ticket sales, and how much in total do they pay out in prizes?

  4. anonymous
    • one year ago
    Best Response
    You've already chosen the best response.
    Medals 0

    500 AND 225?

  5. Valpey
    • one year ago
    Best Response
    You've already chosen the best response.
    Medals 0

    Yes, they collect $500 in ticket sales but they must pay out prizes of $100 plus 3*$25 = $75 plus 5*$10=$50 or $225 in total prizes.

  6. Valpey
    • one year ago
    Best Response
    You've already chosen the best response.
    Medals 0

    So the gross expected value of a ticket is the total prize pool divided by the number of tickets. The net expected value (what the question is asking) is that amount minus the cost of buying a ticket.

  7. anonymous
    • one year ago
    Best Response
    You've already chosen the best response.
    Medals 0

    so the answer is 2.25?

  8. Valpey
    • one year ago
    Best Response
    You've already chosen the best response.
    Medals 0

    The people buying the tickets aren't expecting to profit (unless they have unrealistic expectations about luck or something). They are choosing a fun way of donating money to the Group. They are expecting to lose money, or we can say the expected value of a ticket is negative. The raffle is a fund raiser and the person purchasing the ticket can think of $2.75 going toward the Group and the $2.25 going toward the prize pool.

  9. Valpey
    • one year ago
    Best Response
    You've already chosen the best response.
    Medals 0

    But in terms of the answer to the question, it is the amount that a person buying a ticket expects to lose, so $2.25 - $5.00.

  10. anonymous
    • one year ago
    Best Response
    You've already chosen the best response.
    Medals 0

    Oh... I still confused about it... Do I need to use the probability to calculate it? Such as I have \[\frac{ 1 }{ 100 }\] chance to get $100?

  11. Valpey
    • one year ago
    Best Response
    You've already chosen the best response.
    Medals 0

    You could do it that way for each prize, but it will end up the same.

  12. Valpey
    • one year ago
    Best Response
    You've already chosen the best response.
    Medals 0

    You will see that \(\frac{1}{100}*$100+\frac{3}{100}*$25+\frac{5}{100}*$10=$2.25\)

  13. anonymous
    • one year ago
    Best Response
    You've already chosen the best response.
    Medals 0

    I gotcha! Thank you so much!

  14. Not the answer you are looking for?
    Search for more explanations.

    • Attachments:

Ask your own question

Sign Up
Find more explanations on OpenStudy
Privacy Policy

Your question is ready. Sign up for free to start getting answers.

spraguer (Moderator)
5 → View Detailed Profile

is replying to Can someone tell me what button the professor is hitting...

23

  • Teamwork 19 Teammate
  • Problem Solving 19 Hero
  • You have blocked this person.
  • ✔ You're a fan Checking fan status...

Thanks for being so helpful in mathematics. If you are getting quality help, make sure you spread the word about OpenStudy.

This is the testimonial you wrote.
You haven't written a testimonial for Owlfred.