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Volgvan
1 month ago
12

A local PTA runs a fundraiser, selling lottery tickets for $5, offering 1 first prize of $100 and 5 second prizes worth $20 each

. They sell 100 tickets. What is the expected value of each ticket? -$3 $3 -$2.7 $2.7
Mathematics
1 answer:
Inessa [12.5K]1 month ago
8 0
The expected value is calculated by subtracting the expected cost from the anticipated income.

The expected cost is fixed at $5.

The anticipated income arises from the probability associated with each outcome multiplied by its respective reward.

=> For the first prize: probability * prize = (1 / 100) * $ 100 = $1

=> For the second prize: probability * prize = (5 / 100) * $20 = $1

Thus, the expected value comes out to $1 + $1 - $5

This gives us an expected value of - $3

Final answer: - $ 3
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