Question

The student council is hosting a drawing to raise money for scholarships. They are selling tickets for $8 each and will sell 900 tickets. There is one $3,000 grand prize, two $500 second prizes, and ten $10 third prizes. You just bought a ticket. Find the expected value for your profit. Round to the nearest cent.

Answer 1

Explanation:

the probability that the ticket will win you 600 dollars * 1/1500 = 600/1500.

the probability that the ticket will win you 50 dollars is 50 * 5/1500 = 250/1500.

the probability that the ticket will win you 25 dollars is 25 * 20/1500 = 500/1500.

your expected value is -1 + 600/1500 + 250/1500 + 500/1500 = -.1.

the average loss for each dollar that is bet is equal to 10 cents.

hope this helped