math

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A certain sweepstakes ticket has four categories of prizes with the following probabilities of being won:


Prize

Probability


$100,000

1/500,000


$50,000

1/250,000


$20,000

1/200,000


$10,000

1/100,000

If each ticket costs $1.00, what is the expected gain or loss?
Select one:
a. $.60
b. $6.00
c. $4.00
d. $.40

  • math -

    Multiply each possible prize times the chance of winning and add them all up. compare that number with $1 to find your expected gain or loss. If the number is larger, you have a gain. If the number is smaller, you have a loss.

  • math -

    the number is larger

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