Question

A game is played using one die. If the dio is rolled and shows 5, the player wins $35. If the die shows any number other than 5, the player wins nothing

a. If there is a charge of $7 to play the game, what is the game's expected value

Answer 1

Let random variable "x" be a count of player gain.

X-values are: 4, -1

P(x=4) = 1/6; P(x= -1) = 5/6

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E(x) = (1/6)(4) + (5/6)(-1)

E(x) = [4-5]/6

E(x) = -1/6 = -17 cents

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Cheers,

Stan H.