suppose you buy a ticket for a raffle. the ticket's price is 5$ and the price tis worth 200. If 100 tickets are sold how much money do you expect to win/lose?
You have a 1/100 chance to win a $200 prize. So, your expected winnings are $2.
Not much of a return on a $5 ticket. Still, it's for a worthy cause, right? . . .
To calculate how much money you can expect to win or lose in this raffle, we need to consider the cost of the ticket and the total prize value. Let's break it down:
1. Cost of a ticket: The cost of a single ticket is $5.
2. Total prize value: The prize is worth $200.
Now, let's calculate the expected value:
Expected Value = (Probability of Winning * Value of Prize) - Cost of Ticket
To determine the probability of winning, we need to know how many tickets are sold in total and how many tickets you have purchased. In your case, you bought one ticket, and there are 100 tickets sold in total.
Probability of Winning = 1 / Total Number of Tickets Sold
Probability of Winning = 1 / 100
Expected Value = (1/100 * $200) - $5
Expected Value = $2 - $5
Expected Value = -$3
Hence, based on these calculations, you can expect to lose $3 on average for each ticket you buy in this raffle.