Question

Find the expected value of the winnings

from a game that has the following
payout probability distribution:
Payout ($)
1
4 6 8 10
Probability 0.12 0.2 0.38 0.2 0.1
Expected Value = [?]
Round to the nearest hundredth.

Answer 1

5.80

Explanation:

1 (0.12) + 4 (0.2) + 6 (0.38) + 8 (0.2) + 10 (0.1)

= 5.8

round to the nearest hundredth

= 5.80

Answer 2

Expected value is $20.20

Explanation:

Here, we want to calculate the expected value

What we have to do here is to multiply the probability by the payout value; after which we add all values

Thus, we have the payout value as;

1(0.12) + 4(0.2) +6(0.38) + 8(0.2) + 10(0.1)

= 0.12 + 0.8 + 2.28 + 1.6 + 1

= $ 20.2