Question

"A bag contains 3 gold marbles, 4 silver marbles, and 28 black marbles. Someone offers to play this game: You randomly select on marble from the bag. If it is gold, you win $3. If it is silver, you win $2. If it is black, you lose $1." If you play this game, your expected value will be $ (round to the nearest cent). a) $2.54 b) $1.82 c) $2.00 d) $2.35

Answer 1

3 + 4 + 28 = 35 total marbles

E = $3(3/35) + $2(4/35) - $1(28/35)

= ($9 + $8 - $28)/35

= -$11/35

= -$0.31 ($0.31 loss)