Posted by Trey on Wednesday, March 18, 2009 at 10:30pm.
New Car. A game show gives away 2 new cars. One car is worth $50,000 and the other car is worth $40,000. Two members of the audience are randomly selected to participate and receive one of the two new cars. What is the expeted value if you are randomly chosen and you had to pay $4 to be a member of the audience with 1999 other people.

Math  drwls, Thursday, March 19, 2009 at 7:45am
Your chances are 1/2000 of winning the $50,000 car (if it is drawn first) plus 1/1999 of drawing the second car. Expected value of the opportunity to participate is $45. If you paid $4 for that opportunity, it was a good deal.

Math  Anonymous, Friday, March 20, 2009 at 5:24pm
Thanks
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