To determine: The expected value and find it is a wise idea to play this game.
The expected value is
Given information:
4 of the 8 sectors yield has no pay-outs.
3 of the 8 sectors yield a pay-out of $6.
1 of the 8 sectors pays $10.
Formula used:
Here, E is the favourable outcomes and S is the total possible outcomes.
Calculation:
Since, To pay the $5 for spin the spinner once.
4 of the 8 sectors yield a payoff of $0-$5 = -$5.
Substitute 4 for
3 of the 8 sectors yield a payoff of $6-$5 = $1.
Substitute 4 for
1 of the 8 sectors yield a payoff of $10-$5 = $5.
Substitute 4 for
The expected value (or mean) is the sum of the product of each possibility x with its probability P(x):
Hence, it is not a wise idea to play this game because the expected value is negative.
Chapter 10 Solutions
PRECALCULUS:GRAPHICAL,...-NASTA ED.
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