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A community youth group is having a raffle to raise funds. Several community businesses have donated prizes. The prizes and their retail values are listed
A community youth group is having a raffle to raise funds. Several community businesses have donated prizes. The prizes and their retail values are listed in the table below. Each prize will be given away, regardless of the number of raffle tickets sold. Tickets are sold for $16 each. Determine the expected value of a ticket, and discuss whether it would be to your financial advantage to buy a ticket under the given circumstances. (Enter your answers to two decimal places.) Prize Retail Value Number of These
Prizes to Be
Given Away new car $21,530 1 a cell phone and a one-
year subscription $930 1 a one-year subscription
to an Internet service
provider $500 2 dinner for two at
a local restaurant $110 2 a one-year subscription
to the local newspaper $190 20
(a) 1000 tickets are sold.
$
Should you buy a ticket? YesNo
(b) 2000 tickets are sold.
$
Should you buy a ticket? YesNo
(c) 3000 tickets are sold.
$
Should you buy a ticket? YesNo
A community youth group is having a raffle to raise funds. Several community businesses have donated prizes. The prizes and their retail values are listed in the table below. Each prize will be given away, regardless of the number of raffle tickets sold. Tickets are sold for $16 each. Determine the expected value of a ticket, and discuss whether it would be to your financial advantage to buy a ticket under the given circumstances. (Enter your answers to two decimal places.)
| Prize | Retail Value | Number of These Prizes to Be Given Away |
|---|---|---|
| new car | $21,530 | 1 |
| a cell phone and a one- year subscription | $930 | 1 |
| a one-year subscription to an Internet service provider | $500 | 2 |
| dinner for two at a local restaurant | $110 | 2 |
| a one-year subscription to the local newspaper | $190 | 20 |
(a) 1000 tickets are sold.
$
Should you buy a ticket?
(b) 2000 tickets are sold.
$
Should you buy a ticket?
(c) 3000 tickets are sold.
$
Should you buy a ticket?
$
Should you buy a ticket?
YesNo
(b) 2000 tickets are sold.
$
Should you buy a ticket?
YesNo
(c) 3000 tickets are sold.
$
Should you buy a ticket?
YesNo
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Cornerstones of Managerial Accounting
Authors: Mowen, Hansen, Heitger
3rd Edition
324660138, 978-0324660135
