Question

A spinner game has a wheel with the numbers 1 through 10 marked in equally spaced slots. You pay $1 to play the game. You pick a number from 1 to 10. If the spinner lands on your number, you win $5. Otherwise, you win nothing. Find the expected net winnings for this game. (Round your answer to two decimal places.)

Answer 1

Expected net winnings: -$0.50 per game

Step-by-step explanation:

Winning Net Earnings: $5 - $1 = $4 (total earning - paid to play)

Losing Expenses = -$1 (paid to play)

Prob of winning: 1/10 = 0.10 or 10%

Prob of losing: 9/10 = 0.90 or 90%

E = sum x * P(X=x)

E = 0.10 x $4 + 0.90 x -$1 = -0.50

The expectative is to lose 0.50 every game