Question

Assume that a person spins the pointer and is awarded the amount indicated by the pointer. If it costs $3 to play the game, determine the expectation of a person who plays the game

Answer 1

The player can expect to lose money over the long run.

Explanation:

We would need to know the possible outcomes and the corresponding probabilities of the game to calculate the expectation. Without that information, we cannot calculate the expectation.

The expectation is calculated by multiplying each outcome by its probability and then adding up all the products. In this case, the outcomes are the amounts indicated by the pointer, and the probabilities are the likelihood of the pointer stopping on each amount.

If we knew the probabilities, we could calculate the expected value as follows:

Expected value = (amount 1 x probability 1) + (amount 2 x probability 2) + ... + (amount n x probability n)

We would then subtract the cost to play the game to get the net expected value. If the net expected value is positive, it means that the player can expect to make a profit over the long run, while if it is negative, it means that the player can expect to lose money over the long run.