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15 February, 15:27

You buy a lottery ticket to a lottery that costs $10 per ticket. There are only 100 tickets available to be sold in this lottery. In this lottery there are one $430 prize, two $105 prizes, and four $30 prizes. Find your expected gain or loss.

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  1. 15 February, 18:50
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    -$2.4

    Explanation:

    Costs of lottery ticket $10 per ticket.

    100 tickets available to be sold

    One $430 prize

    two $105 prizes

    four $30 prizes

    100 available tickets - 7 prizes = 93

    P (430) = 1/100

    P (105) = 2/100

    P (30) = 4/100

    P (-10) = 93/100

    -10 (93/100) + 30-10 (4/100) + 105-10 (2/100) + 430-10 (1/100)

    = - 10 (93/100) + 20 (4/100) + 95 (2/100) + 420 (1/100)

    = - 9.3 + 0.8 + 1.9 + 4.2 = - 2.4

    Therefore the expected loss will be $2.4
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