Question

Tickets for a raffle cost
$ 17. There were 641 tickets sold. One ticket will be randomly selected as the winner, and that person wins
$ 1900 and also the person is given back the cost of the ticket. For someone who buys a ticket, what is the Expected Value (the mean of the distribution)?

If the Expected Value is negative, be sure to include the "-" sign with the answer. Express the answer rounded to two decimal places.

Answer 1

The expected value for the discrete distribution modeling this situation is of -$14.04.

What is the mean of a discrete distribution?

The expected value of a discrete distribution is given by the sum of each outcome multiplied by it's respective probability.

The distribution that models the earnings of a single person, considering that there is a 1/641 probability of winning and the cost of the ticket is given by:

• P(X = 1900 - 17) -> P(X = 1883) = 1/641.

• P(X = -17) = 640/641.

Hence the expected value is given by:

E(X) = 1883 x 1/641 - 17 x 640/641 = -$14.04.

More can be learned about the expected value of a discrete distribution at https://brainly.com/question/3316979

#SPJ1