Question

Suppose that you and a friend are playing cards and you decide to make a friendly wager. The bet is that you will draw two cards without replacement from a standard deck. If both cards are spades, your friend will pay you $39 $ ⁢ 39 . Otherwise, you have to pay your friend $5 $ ⁢ 5 . Step 2 of 2 : If this same bet is made 623 623 times, how much would you expect to win or lose? Round your answer to two decimal places. Losses must be expressed as negative values.

Answer 1

The amount of winning is more than amount of loosing. Then the amount of winning will be $3738.

How to find that a given condition can be modelled by binomial distribution?

Binomial distributions consist of n independent Bernoulli trials.

The expected value will be

E(X) = np

Suppose that you and a friend are playing cards, and you decide to make a friendly wager.

The bet is that you will draw two cards without replacement from a standard deck.

If both cards are spades, your friend will pay you $39.

Otherwise, you have to pay your friend $5.

If this same bet is made 623 times.

The maximum amount of winning will be

E(win) = np

We have

p = 0.25

n = 623

Then we have

E(win) = 0.25 × 623

E(win) = 155.75

Then the winning amount will be

WA = 155.75 × 39

WA = $6074.25

The maximum amount of loosing will be

E(loose) = np

We have

p = 0.75

n = 623

Then we have

E(loose) = 0.75 × 623

E(loose) = 467.25

Then the loosing amount will be

LA = 467.25 × 5

LA = $2336.25

Then the amount of winning will be

⇒ $ 6074.25 - $ 2336.25

⇒ $ 3738

Learn more about binomial distribution here:

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