Question
A charity organization hosts a raffle drawing at a fund raising event. The organization sells 2500 tickets at a price of $8 each. Winning tickets
A charity organization hosts a raffle drawing at a fund raising event. The organization sells 2500 tickets at a price of $8 each. Winning tickets are randomly selected, with 30 prizes of $100, 10 prizes of $500, and 1 grand prize of $8000. Suppose you buy one ticket. Let the random variable X represent your net gain from playing the game once (remember that the net gain should include the cost of the ticket).
- If you were organizing a raffle like this, how would you change the game (ticket prices, number of tickets, prize amounts, etc.) in order to encourage more people to purchase tickets while still raising at least $4000 for your organization? Your response should include a short paragraph, written in complete sentences, with an explanation of the specific adjustments or changes that you would make and how these changes would encourage more people to purchase tickets.
- Construct a new probability distribution describing the net gain (from the player's perspective) for the game with your proposed changes from #1.
(Iv'e seen the following solution: To coerce more people into purchasing tickets I would introduce an additional chance of winning. Any tickets with the same first 3 digits of the grand prize ticket will receive a $20 consolation prize. I would also lower the ticket price from $8 to $7 to slightly increase a player's net gain. Additionally, 500 more raffle tickets will be added to the total. Assuming that each ticket is sold and that each prize is won once, the total profit for the raffle would sum up to be $4910.) So, 23000(7) = $210009(9) + 100(30) + 500(10) + 8000(1) = $1609021000 - 16090 = $4910
But I don't understand where the 500 additional raffle tickets come from or where the numbers 23000(7) & $210009(9) come from in the solution
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