Question

Tickets for a raffle cost $18 There were 727 tickets sold. One ticket will be randomly selected as the winner, and that person wins $1500 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)?

Answer 1

Step 1

Given; Tickets for a raffle cost

$18 There were 727 tickets sold. One ticket will be randomly selected as the winner, and that person wins

$1500 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)?

Step 2

$E=-18(\frac{726}{727})+(1500+18)(\frac{1}{727})$$\begin{gathered} E=-\frac{13068}{727}+\frac{1518}{727} \\ E=\frac{-11550}{727} \\ E=-15.88720 \\ E\approx-15.89 \end{gathered}$

Answer;