Question

Find the expected value of the winnings from a game that has the following payout probability distribution: Payout ($) 1 2 5 8 10 Probability 0.35 0.2 0.1 0.2 0.15 = Expected Value = [?] Round to the nearest hundredth. Enter​

Answer 1

Multiply each payout by the corresponding probability, and add these up:

1•0.35 + 2•0.2 + 5•0.1 + 8•0.2 + 10•0.15 = 4.35

So one can expect to win $4.35 from playing the game.