Final answer:
The expectation of the contest is $0.09.
Step-by-step explanation:
Problem:
A magazine subscription service is having a contest in which the prize is $270,000. If the company receives 3 million entries, what is the expectation of the contest?
Solution:
The expectation of the contest can be calculated by multiplying the probability of winning the prize (1 in 3 million) by the value of the prize ($270,000).
Probability of winning = 1/3,000,000
Value of the prize = $270,000
Expectation = Probability of winning * Value of the prize
Expectation = (1/3,000,000) * $270,000
Expectation = $0.09
Answer:
The expectation of the contest is $0.09.