Question

St. Mary's Church is holding a raffle in which 1172 tickets have been sold at a cost of $2.00 each. Three prizes will be awarded: 1 for S500;1 for $250; 1 for $125. If you buy one ticket, then your expected value for this raffle is $ You do not need to include the dollar sign (S) with your answer. Give your answer as numerical value rounded to 2 decimal places. No $ sig?n

Answer 1

Explanation:

Given that St. Mary's Church is holding a raffle in which 1172 tickets have been sold at a cost of $2.00 each.

Three prizes will be awarded: 1 for S500;1 for $250; 1 for $125.

Thus total number of tickets = 1172

Of these prize winning are 3

i.e. Tickets Prize $ Net win amount Prob Net win amt*prob

1 500 (500-2) =448 1/1172 448/1172

1 250 (250-2) =248 1/1172 248/1172

1 125 (125-2) =123 1/1172 123/1172

1169 0 (0-2) = -2 1169/1172 -2338/1172

Expected value = Total -1519/1172

=-1.296