A contest entrant has a .00001 probability of winning $5,000.00. If this is only prize and the entry fee is $20.00, then what is the expected value?

Regardless of what you pay for an entry "ticket" its expected value is in this case
(probability of winning) x (prize money) = 10^-5 x $5,000 = $0.50

Not a very good bet, if you pay $20 for it

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asked by Sue

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