Question

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

Answer 1

100 tickets were sold.
The total amount of the tickets sold is = 5 * 100 = $500.
First prize given = $100
Second prize worth = $20 * 5 = $100
Total worth of prize + $100 + $100 = $200.
Net amount of tickets sold = $500 - $200 = $300
Expected price of each ticket sold = $300/100 = 3.
Therefore, the real price of each ticket sold is $3.